Ultrasensitive magnetoelectric (ME) sensors have been developed using magnetostrictive/piezoelectric laminate heterostructures. This paper discusses a highly interdisciplinary design of a room temperature biomagnetic liver susceptometry system (BLS) based on the ME sensors. The ME-sensor based BLS maintains the ultrahigh sensitivity to detect the weak AC biomagnetic signals and introduces a low equivalent magnetic noise. The results reveal a 'turning point' and successfully indicate the output signals to be linearly responsive to iron concentrations from normal iron level (0.05 mgFe/gliver phantom) to 5 mgFe/gliver phantom iron overload level (100X overdose). Further, the introduction of the water-bag technique shows the promise on the automatic deduction of the background (tissue) signal, enabling an even higher sensitivity and better signal-to-noise (SNR). With these improvements, it becomes feasible to get improved characterization flexibility and the field distribution mapping potential via signal processing from the correlations of multiple sensors in the system. Considering the wide presence of biomagnetic signals in human organs, the potential impact of such biomagnetic devices on medicine and health care could be enormous and far-reaching.