The different types of magnetism can be classified on the basis of how the internal magnetic dipoles align when suspended in an external magnetic field.

(i) If the magnetic dipoles align in the opposite direction as the applied magnetic field, diamagnetism arises and the magnet is repelled by the external magnetic field.

(ii) Paramagnetism arises when the magnetic dipoles align in the same direction as the external magnetic field, and the magnet is attracted by the external magnetic field.

(iii) Ferromagnetic materials sometimes have permanently fixed dipoles in the direction of the external field, and they are strongly attracted by the external magnetic field.