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The interaction between diffuse vacuum arcs and magnetic fields applied transverse to the electrode axis has been investigated both theoretically and experimentally. For arc currents < 6 kA, Hall electric fields, generated by the interaction, bow the plasma out of contact with the anode and raise the arc voltage. In the presence of a parallel capacitor, the arc current falls to zero and the arc is extinguished. For arc currents of 6 to 15 kA, arc extinction can be achieved with an oscillatory magnetic field; during such extinctions the arc voltage remains in phase with the magnitude of the field. Arc extinction via magnetic field/vacuum arc interaction could have applications to ac-current limiters and dc breakers. The fault current limiter application is discussed in this paper.