Electrophysiological activity in the human brain generates a small magnetic field from the spatial superposition of individual neuronal source currents. At a distance of about 15 mm from the scalp, the observed field is of the order of 10−13 to 10−12 T peak-to-peak. This measurement process is termed magnetoencephalography (MEG). In order to minimize instrumental noise, the MEG is usually detected using superconducting flux transformers, coupled to SQUID (superconducting quantum interference device) sensors. Since MEG signals are also measured in the presence of significant environmental magnetic noise, flux transformers must be designed to strongly attenuate environmental noise, maintain low instrumental noise and maximize signals from the brain. Furthermore, the flux transformers must adequately sample spatial field variations if the brain activity is to be imaged. The flux transformer optimization for maximum brain signal-to-noise ratio (SNR) requires analysis of the spatial and temporal properties of brain activity, the environmental noise and how these signals are coupled to the flux transformer. Flux transformers that maximize SNR can detect the smallest brain signals and have the best ability to spatially separate dipolar sources. An optimal flux transformer design is a synthetic higher-order gradiometer based on relatively short-baseline first-order radial gradiometer primary sensors.