The early stages of the 2002-2003 lateral eruption at Mount Etna were accompanied by slow changes (over some hours) and some rapid step offsets in the local magnetic field. At five monitoring locations, the total magnetic field intensity has been measured using continuously operating Overhauser magnetometers at a sampling rate of 10 s. The very unique aspect of these observations is the close temporal correspondence between magnetic field offsets and earthquakes that occurred in the upper northern flank of the volcano on 27 October 2002 prior to a primary eruption. Rapid coseismic changes of the magnetic field were clearly identified for three of the most energetic earthquakes, which were concentrated along the Northeast Rift at a depth of about 1 km below sea level. Coseismic magnetic signals, with amplitudes from 0.5 to 2.5 nT, have been detected for three of the largest seismic events located roughly midway between the magnetic stations. We quantitatively examine possible geophysical mechanisms, which could cause the magnetic anomalies. The comparison between magnetic data, seismicity and surface phenomena implies that piezomagnetic effects are the primary physical mechanism responsible for the observed magnetic anomalies although the detailed cause of the rapid high stress change required is not clear. The modeling of the observed coseismic magnetic changes in terms of piezomagnetic mechanism provides further evidence of the complex interaction between volcanic and tectonic processes during dike propagation along the Northeast Rift. Copyright 2007 by the American Geophysical Union.