The calculation of critical speeds for turbomachinery with active magnetic bearings (AMBs) is of great interest due to the increasing number of applications of this new technology. The potential for increased turbomachine performance through improved AMB design has created the need for a more accurate method for predicting the system's undamped critical speeds. This thesis documents the development of a method which improves the accuracy of critical speed calculation by properly accounting for the influence of AMB sensor location on the undamped critical speeds. This investigation includes the development of an AMB modified Jeffcott model. The results from the AMB modified Jeffcott analysis give useful design guidance for the influence of the sensor location on the first and third modes of a symmetric rotor system. A more accurate solution using a transfer matrix method modified to account for AMB sensor locations is presented. The results from the transfer matrix method for an example compressor are presented showing the influence of the sensor placement on a standard undamped critical speed map. The mode shapes with sensor location at a typical design location are given to illustrate the importance of the sensor location.