Sensor-based 3D hand tracking is still challenging despite the massive exploration of different sensing modalities in the past decades. This work describes the design, implementation, and evaluation of a novel induced magnetic field-based 3D hand tracking system, aiming to address the shortcomings of existing approaches and supply an alternative solution. This system is composed of a set of transmitters for the magnetic field generation, a receiver for field strength sensing, and the Zigbee units for synchronization. In more detail, the transmitters generate the oscillating magnetic fields with a registered sequence, the receiver senses the strength of the induced magnetic field by a customized three axes coil, which is configured as the LC oscillator with the same oscillating frequency so that an induced current shows up when the receiver is located in the field of the generated magnetic field. Five scenarios are explored to evaluate the performance of the proposed system in hand tracking regarding the transmitters deployment: "in front of a whiteboard", "above a table", "in front of and in a shelf", "in front of the waist and chest", and "around the waist". The true-range multilateration method is used to calculate the coordinates of the hand in 3D space. Compared with the ground truth collected by a commercial ultrasound positioning system, the presented magnetic field-based system shows a robust accuracy of around ten centimeters with the transmitters deployed both off-body and on-body(in front of waist and chest), which indicates the feasibility of the proposed sensing modality in 3D hand tracking.