When and why does a rechargeable battery lose capacity or go bad? This is a question that is surprisingly difficult to answer; yet, it lies at the heart of progress in the fields of consumer electronics, electric vehicles, and electrical storage. The difficulty is related to the limited amount of information one can obtain from a cell without taking it apart and analyzing it destructively. Here, we demonstrate that the measurement of tiny induced magnetic field changes within a cell can be used to assess the level of lithium incorporation into the electrode materials, and diagnose certain cell flaws that could arise from assembly. The measurements are fast, can be performed on finished and unfinished cells, and most importantly, can be done nondestructively with cells that are compatible with commercial design requirements with conductive enclosures.