Eddy-current sensor is widely applied in gratingtype displacement measurement system for its good reliability and environmental tolerance. The sensitivity of the grating eddy-current sensor could be indicated by the change rate of the probe coil inductance along with the lateral movement of the detected reflection conductor. In this paper, the affection of various factors on the sensitivity of the sensor is studied in detail. These factors include geometric parameters of the coil, lift-off distance and exciting frequency. Finite element analysis is used to plot the inductance curve as the function of the lateral distance of the conductor. The steepness of the curve indicates the sensitivity of the sensor intuitively. By changing one of the parameters while other parameters are fixed, different inductance curves are plotted and the principles of relationships between the parameter and sensitivity are obtained. It is indicated from the results that the sensitivity of the sensor could be improved by decreasing the lift-off distance, reducing the height of the coil and increasing the exciting frequency. The radial thickness of the coil has little affection on the sensitivity. Additionally, the sensitivity of the planar coil is much higher than that of the cylinder coil. These results provide valuable principles for the eddy-current sensor design and optimization.