The direction in which the induced emf drives the current around a wire loop can be found through the negative sign. However, it is usually easier to determine this direction with Lenz's law, named in honor of its discoverer, Heinrich Lenz (1804–1865). Lenz's law states that the direction of the induced emf drives the current around a wire loop always to oppose the change in magnetic flux that causes the emf.

If a bar magnet is moved toward a coil such that the magnetic flux through the coil increases, then an induced current is generated in the coil. This current produces a magnetic field that opposes the increasing magnetic field of the moving bar magnet. On the other hand, if the bar magnet is moved in such a way that it results in a decreasing magnetic flux through the coil, then the induced current creates a magnetic field that opposes the decrease in the magnetic field of the bar magnet. An induced current can also be created if the bar magnet is kept stationary and the coil is moved toward or away from it. In this case, the induced current exerts a magnetic force on the coil such that it opposes the motion of the coil.

Lenz's law can also be considered in terms of the conservation of energy. If pushing a magnet into a coil causes a current, the energy in that current must have come from somewhere. If the induced current opposes any increase in the magnetic field of the bar magnet that was pushed in, then the situation is clear. In this case, the magnet is pushed against an induced magnetic field and does work on the system, which results in a current. On the other hand, if the induced current and corresponding induced magnetic field did not oppose the magnetic field of the bar magnet, then the bar magnet would be pulled in without having to do any work, and an electric potential energy would be created, violating the conservation of energy.