Flux-reversal permanent magnet (PM) machines can be considered as stator-surface-mounted PM (SSPM) machines, where normally a pair of magnets with reversal magnetization polarities is mounted on the surface of each stator tooth. Hence, the SSPM machines and the conventional rotor surface-mounted PM (RSPM) machines are rather similar since both machines house the PMs in the air-gap, and the only difference is the location of magnets in the stator side and rotor side, respectively. In this study, a comparative study between SSPM and RSPM machines is conducted to investigate the difference including topology, operation principle and performance. First of all, the topology of both machines is compared. Then, the operation principle in both machines is analysed based on the air-gap field modulation theory. Correspondingly, the characteristics of flux density harmonics either due to PMs or armature reaction are obtained. Therefore, the harmonics that make contribution to back-electromotive force and rated torque are quantified. Besides, other electromagnetic performances, e.g. overload capability, flux weakening ability and loss distribution are also evaluated. Finally, a 12/14 prototyped SSPM machine is manufactured and tested to verify analytical and finite element method-based prediction.