Crosswell electromagnetic measurements are a promising new geophysical technique for mapping subsurface electrical conductivity. Because the conductivity of sedimentary rocks depends on the conductivity of the fluid that fills the rock pores, the variations in conductivity can provide information about the subsurface distribution of water, oil or steam. In this work the fields from a low frequency vertical magnetic dipole have been examined from the specific point of view of their application to the determination of the conductivity of a layered medium. Since it was established that the sensitivity of the fields to the conductivity distribution is higher when the source and the receiver axe located inside the medium they were placed inside two separate boreholes. The range of penetration of such a crosswell system for typical earth resistivities and for currently available transmitter and receiver technologies was found to be up to 1000 meters so problems in ground water and petroleum reservoir characteristics can be practically examined. The parameters that affect the conductivity estimates have been assessed using a whole-space approximation to simulate the conditions around the boreholes. It was established that the sensitivity of the fields to the variations in conductivity depends on the transmitter-receiver geometry and that the regions where fields change sign or vary rapidly with distance are subject to large errors caused by the possible misplacement of the transmitter with respect to the receiver. An analysis of the behavior of the magnetic fields at the boundary between two half-spaces showed that the horizontal magnetic field component, I-lp, and the vertical derivative of a vertical component, 8Hz/SZ, are more sensitive to conductivity variations than Hz. The analysis of derivatives led to the concept of measuring the conductivity directly using a second vertical derivative of Hz. Conductivity prof'des interpreted from field data using this technique reproduced accurately the electrical logs for a test site near Devine, Texas.