Laser scribing of 3% silicon steel laminations was carried out using three different lasers : a KrF excimer laser, a pulsed Nd:YAG laser and a continuous wave CO2 laser. The processing parameters included the energy fluence at the surface of the workpiece, pulse repetition rate and pulse separation distance (for the pulsed lasers), scan separation distance and scan direction. The samples were tested for hysteresis loss, permeability, coercivity, remanence and saturation induction before and after laser treatment. An overall improvement in the core loss was observed in the laser-scribed samples. The best improvement in core loss was obtained in excimer laser scribing on the rolling direction and CO2 laser scribing in the transverse direction. Three mechanisms were proposed to explain the improvement in energy efficiency characteristics of the silicon-steel samples : magnetic domain refinement, stress relaxation and inhibition of domain-wall movement. Domain refinement, namely the formation of subdomains, results from the shocks induced by the beam. Laser scribing also relieves the stresses that are induced in the material during manufacture. The scribe lines increase the surface resistivity of the material, resulting in reduced eddy current loss. Tensile stresses are created between the laser scribe lines that elongate the domains and serve to refine the domain-wall spacing thus inhibiting the wall movement and reducing core losses.