Magnetically-levitated drives are compelling in applications where the long-lifetime operation or process chamber encapsulation is a requirement. To exploit these advantages, contactless position sensors are needed to estimate the position of the rotor. Off-the-market sensor technologies render highperformance magnetic levitation possible, yet their system integration may be challenging if a drive must be designed to fit existing sensor technology or bulky probes. In this work, a position-estimation system based on Eddy-current generation is proposed. Two integrated circuits (or only one for less time-critical applications) excite a two-axis differential array of four miniature coils that can resolve positions in the 100 μm range. Coupled to a microcontroller, this system can sample the position of an electrically conductive target —in this study, the permanent magnet rotor of a magnetically-levitated drive— with frequencies of over 3.5 kHz. This position estimation setup enables the successful levitation of two miniature bearingless disc drives and offers potential towards rotatory speeds in the 20 krpm range.