Abstract. In underdoped high-T c cuprates, d-wave superconductivity competes with antiferromagnetism. It has generally been accepted that suppressing superconductivity leads to the nucleation of spin-density wave (SDW) order with wavevector near (π, π). We show theoretically, for a d-wave superconductor in an applied magnetic field including disorder and electronic correlations, that the creation of SDW order is in fact not simply due to suppression of superconductivity, but rather due to a correlation-induced splitting of an electronic bound state arising from the sign change of the order parameter along quasiparticle trajectories. The induced SDW order is therefore a direct consequence of the d-wave symmetry. The formation of anti-phase domain walls proves to be crucial for explaining the heretofore puzzling temperature dependence of the induced magnetism as measured by neutron diffraction.A superconductor is characterized by a Bardeen-Cooper-Schrieffer (BCS) order parameter k (R), where R is the center-of-mass coordinate of a Cooper pair of electrons with momenta (k, −k). The bulk ground state of such a system is homogeneous, but a spatial perturbation that breaks pairs, e.g. a magnetic impurity, may cause the suppression of k (R) locally. What is revealed when superconductivity is suppressed is the electronic phase in the absence of k , a normal Fermi liquid. Thus the low-energy excitations near magnetic impurities and in the vortex 4 Author to whom any correspondence should be addressed. [9,10] detected magnetic ordering as a wedge-shaped extension of the 'spin glass' phase into the SC dome of the temperature versus doping phase diagram ( figure 1(a)). Lake et al [2] reported that an incommensurate magnetic order similar to the field-induced state was also observed in zero field. Although it also vanished at T c , the ordered magnetic moment in zero field had a T dependence, which was qualitatively different from the field-induced signal. The zero-field signal was attributed to disorder, but the relation between impurities and magnetic ordering remained unclear. Because strong magnetic fluctuations with similar wavevectors are reported at low but nonzero energies in inelastic neutron scattering experiments on these materials, e.g. on optimally doped LSCO samples exhibiting no spin-glass phase in zero field, it is frequently argued that impurities or vortices simply 'freeze' this fluctuating order [11].Describing such a phenomenon theoretically at the microscopic level is difficult due to the inhomogeneity of the interacting system, but it is important if one wishes to explore situations with strong disorder, where the correlations may no longer reflect the intrinsic spin dynamics of the pure system. Such an approach was proposed in a model calculation for an inhomogeneous d-wave superconductor with Hubbard-type correlations treated in the mean field [12]. In this model, a single impurity creates, at sufficiently large Hubbard interaction U and impurity potential strength V imp , a droplet of staggered magn...