Advanced sensing and measurement techniques are key technologies to realize a smart grid. The giant magnetoresistance (GMR) effect has revolutionized the fields of data storage and magnetic measurement. In this work, a design of a GMR current sensor based on a commercial analog GMR chip for applications in a smart grid is presented and discussed. Static, dynamic and thermal properties of the sensor were characterized. The characterizations showed that in the operation range from 0 to ±5 A, the sensor had a sensitivity of 28 mV·A(-1), linearity of 99.97%, maximum deviation of 2.717%, frequency response of −1.5 dB at 10 kHz current measurement, and maximum change of the amplitude response of 0.0335%·°C(-1) with thermal compensation. In the distributed real-time measurement and monitoring of a smart grid system, the GMR current sensor shows excellent performance and is cost effective, making it suitable for applications such as steady-state and transient-state monitoring. With the advantages of having a high sensitivity, high linearity, small volume, low cost, and simple structure, the GMR current sensor is promising for the measurement and monitoring of smart grids.