This paper presents a scheme to measure radial and axial position of a magnetically levitated rotor based on hall-effect sensors. Linear hall-effect sensor is selected due to its low cost and miniature size. The proposed sensor system consisted of two hall-sensor modules attached on the stator, and a ring permanent magnet mounted on the rotor. The sensor module is designed via finite-element analysis to optimize sensitivity and accuracy of the measured signal. The experimental results demonstrated a satisfactory performance of the sensor system. However, it was also found that the magnetic field on the ring PM must be uniform to prevent errors in the position measurements.