To improve the detection accuracy of a magnetostrictive liquid level sensor, different placements of float magnets in the bias magnetic fields of the sensor and its impact on the detection voltage were researched. The bias magnetic fields generated by float magnets in different placements were analyzed by the finite element analysis of ANSYS software. It was found that when three pieces of magnets under NNS placement or one single ring magnet are chosen as bias magnetic field, the detection voltage waveform is in line with expectations. Besides, the effects of bias magnetic field of magnetostrictive liquid level sensor were done on detection voltage were experimentally studied and the experiments were done more times for the float magnets at different placements. The experiment results verify that when the bias magnetic field is generated by three pieces of magnets under NNS placement or one single ring magnet, the amplitude of detection voltage reaches 50 mV, which has improved almost 30 mV as compared with that of other ways. It suggests that three pieces of magnets under NNS placement or one single ring magnet can be applied as the bias magnetic field of magnetostrictive liquid level sensors.