Abstract: Eddy current testing is a classic electromagnetic nondestructive testing method that can achieve high-precision defect detection by measuring the amplitude and phase of the AC signal. The signal processing of eddy current detection mainly includes digital detection and analog detection. The digital detection has strong flexibility and good applicability, but it needs high-speed data acquisition and transmission devices, as well as the high transmission bandwidth. In this paper, a digital eddy current testing system based on threshold undersampling was designed, including an eddy current detection circuit, a data acquisition circuit, an Ethernet-based data transmission circuit algorithm. Firstly, the threshold of the eddy current signal was divided, and only the part of the AC signal that exceeded the threshold was collected, so as to reduce the amount of data in the eddy current detection system. Ethernet was used to send data to the PC, and the software algorithm realizeds the detection of the AC signal, which reduced the amount of data transmission and improved the bandwidth utilization of the signal transmission system while ensuring the accuracy of eddy current detection.