To address the poor effect of optical/visual guidance used in AUV terminal docking with strong background light and turbid water quality, an underwater electromagnetic guidance method based on the magnetic dipole model is proposed in this paper. According to the magnetic dipole model, the electromagnetic field of 1 kHz frequency generated by the coil in the range of terminal docking is the near field, where the position can be figured out through the amplitude and phase information of three orthogonal magnetic field intensity vectors. A triaxial-coil magnetometer with three orthogonal coils and a method for extracting the amplitude and phase information of the induced voltage are presented in this paper. According to Faraday’s law, the amplitude and phase information of the induced voltage of a triaxial-coil magnetometer replace the information of magnetic field intensity in relation to positioning. The underwater positioning results show that the average positioning error within 6 m can reach the centimeter level. Five underwater terminal docking tasks were carried out, and four of them were successfully completed, which verified the feasibility of the proposed method.