We present two new potential-inversion methods for estimating the depth and the nature (structural index) of the source, which use various combinations of different forms of local wavenumbers and the information about the horizontal location to estimate individually the depth and the nature of a magnetic source. The improved local wavenumber methods only use the horizontal offset and vertical offset of local wavenumbers to estimate the depth and the structural index of the source, so they yield more stable results compared with the results obtained by current methods that require the derivatives of local wavenumbers. Tests conducted with synthetic noise-free and noise-corrupted magnetic data show that the proposed methods can successfully estimate the depth and the nature of the geologic body. However, our methods are sensitive to high-wavenumber noise present in the data, and we reduced the noise effect by upward continuing the noise-corrupted magnetic data. The practical application of the new methods is tested on a real magnetic anomaly over a dike whose source parameters are known and the inversion results are consistent with the true values.