This study addresses the theoretical and experimental investigations of grating-patterned magnetostrictive FeCo coated surface acoustic wave (SAW) device for sensing magnetic field. The proposed sensor is composed of a configuration of differential dual-delay-line oscillators, and a magnetostrictive FeCo grating array deposited along the SAW propagation path of the sensing device, which suppresses effectively the hysteresis effect by releasing the internal binding force in FeCo. The magnetostrictive strain and ΔE effect from the FeCo coating modulates the SAW propagation characteristic, and the corresponding shift in differential oscillation frequency was utilized to evaluate the measurant. A theoretical model is performed to investigate the wave propagation in layered structure of FeCo/LiNbO3 in the effect of magnetostrictive, and allowing determining the optimal structure. The experimental results indicate that higher sensitivity, excellent linearity, and lower hysteresis error over the typical FeCo thin-film coated sensor were achieved from the grating-patterned FeCo coated sensor successfully.