The sensitivity of linear variable differential transformer (LVDT) position sensors to external slowly varying magnetic fields represents a critical issue when these sensors are installed close to high-current cables or electrical motors with significant fringe fields. The resulting position error can reach several hundreds of micrometers against a specified uncertainty normally below a few micrometers. In this paper, the design of a LVDT position sensor with high rejection to external constant or slowly varying magnetic fields is addressed by exploiting the finite element method (FEM) simulator FLUX. A shield, isolated from the sensor's magnetic circuit, has been considered to reduce the effect of magnetic fields on the secondary voltages of the LVDT. In addition, a dc current is used in order to polarize the magnetic circuit to reduce the sensitivity of the sensor to external interferences.