In the marketplace for electrical transformer test equipment, there is a lot of talk about demagnetization of transformers. It is a recommended practice that probably will make it into the international guidelines and standards for transformer testing in the future. The importance of demagnetization is generally understood, but the underlying reasons and mechanisms are often unknown. This application note strives to explain the magnetic properties of the transformer, how standard measurements can affect these properties and how the transformer can be brought back to an un-magnetized state. The application note also describes when demagnetization is important and when it can be left out with little risk to the integrity of the electrical network.