The Belgian Institute of Space Aeronomy (BIRA-IASB), "Centre Spatial de Liège" (CSL), "Laboratoire de Techniques Aéronautiques et Spatiales" (LTAS) of University of Liège, and the Microwave Laboratory of University of Louvain-La-Neuve (UCL) are collaborating in order to develop a miniature version of a xylophone bar magnetometer (XBM) using Microelectromechanical Systems (MEMS) technology. The device is based on a classical resonating xylophone bar. A sinusoidal current is supplied to the bar oscillating at the fundamental transverse resonant mode of the bar. When an external magnetic field is present, the resulting Lorentz force causes the bar to vibrate at its fundamental frequency with an amplitude directly proportional to the vertical component of the ambient magnetic field. In this paper we illustrate the working principles of the XBM and the challenges to reach the required sensitivity in space applications (measuring magnetic fields with an accuracy of approximately of 0.1 nT). The optimal dimensions of the MEMS XBM are discussed as well as the constraints on the current flowing through the bar. Analytical calculations as well as simulations with finite element methods have been used. Prototypes have been built in the Microwave Laboratory using Silicon on Insulator (SOI) and bulk micromachining processes. Several methods to accurately measure the displacement of the bar are proposed.