The earth's magnetic field is about 49000nT [nano-Tesla] around the UK. Presence of ferrous material (iron mainly) will distort this field - increasing it in some places and decreasing it in others [basically the magnetic field "prefers" to go through the iron]. This difference is called the "magnetic anomaly" and is what a magnetometer can measure. This is "remote sensing" - the ability to detect something from a distance. The advantage of using the total field [rather than a component] is that it is independent of the orientation of the measuring probe.
A detailed discussion of the underlying theory of this creation of an anomaly is discussed here - mainly aimed at deducing as much as possible about the wreck from the measurements.
Here I give a briefer summary - advice on detecting a wreck from surface (or near surface) magnetometer measurements.
To locate an iron/steel vessel in a diveable depth is rather easy.
The anomaly will be a few hundred nT (small coaster in 35m) to a
few thousand nT (large ship). The largest (positive) anomaly will be
approximately above the wreck (actually shifted south by a distance of
about 20% of the depth in UK latitudes). A "rule of thumb" is that an iron/steel wreck
can be detected at a distance three times its length away from its centre.
Some wrecks that I have explored have been sufficiently shallow to give a surface anomaly that varies with position so rapidly that a traditional proton magnetometer malfunctions.
A wooden sailing vessel is harder to locate magnetically, unless it had
substantial cast-iron ballast, or a ferrous cargo. A sailing vessel will have ferrous components -
the anchor, chain, brackets, windlass, guns,..., but these give a relatively small signal.
For instance a cannon ball (iron sphere of 10 cm diameter) gives a magnetic anomaly of around 1 nT
at 2 metres distance from it. This anomaly [as all anomalies when at a distance large compared
to the size of the source] decreases as the inverse cube - so 8 times smaller
when twice as far away. Typical values reported from old sailing ships are less than 50 nT.
This requires a more sophisticated survey:
(i)an Overhauser or caesium vapour magnetometer,
(ii)a reference magnetometer to correct for fluctuations, during the survey, of the earth's field [typically 10 nT per day but much more during magnetic storms],
(iii)care to exclude magnetic effects from the boat (by towing far enough behind),
(iv)care to get the magnetometer head as close to the target as possible,
(v)care to measure the location and depth of the magnetometer probe,
(vi)care to avoid electrical (and electro-magnetic) interference in the measurement.
Survey grid and interpretation. Typically, an isolated magnetic source at depth d will give a positive signal, on a plane surface above it, with a width [full width at half maximum] of about d. To resolve this, a grid size smaller than d is needed. So if the "head" is 5 metres above the object, measurements every 2 metres or so would be sufficient - anything closer spaced would add little more.