This paper describes the development of a high resolution eddy current imaging system by combining the basic principles of conventional eddy current and an atomic force microscope (AFM). The eddy currents are generated by exciting a small coil, placed under an electrically conductive sample, with a low frequency electromagnetic signal. The eddy currents through the sample are detected by a magnetic film coated AFM tip-cantilever. The force between the coil and the magnetic tip, with and without the electrically conductive sample, is related to the electrical conductivity, at that location in the sample. The images of the electrical conductivity variations in the sample are obtained by scanning the sample with a magnetic film coated tip. Eddy current images of metal, composite, and nano-composites are presented. A theoretical model developed to evaluate the response of the magnetic film coated AFM tip under the eddy current excitation is described. The results obtained on simple metals are compared with the theoretical model. The model is used to interpret in general the observed contrast and features in different materials.