The best method to demagnetize is by keeping the magnet in a coil through which an alternating current is passed. When the current starts flowing through the coil, the magnet is pulled out of the coil in east-west direction and kept far away. The magnetic field produced due to alternating current changes its direction continuously. As the magnet is withdrawn far away the magnetization becomes weaker and weaker until finally the magnet is completely demagnetized.
Other methods of demagnetization are by rough handling and by heating. If a magnet is hammered by placing it in the east-west direction, it loses its magnetism completely. While heating and rough handling, the molecular magnets starts vibrating and move out of the magnetic alignment. Hence the magnet loses the magnetism.
