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We investigated the use of diamagnetic materials in magnetic bearings using an experimental apparatus to study the static equilibrium, load-carrying capacity, and dynamic characteristics of the bearings. The apparatus consisted of a 0.79-g NdFeB disk-shaped permanent-magnet rotor levitated by a ferrite magnet with a diamagnetic stabilizer made of either bismuth or graphite, all in a bell-jar vacuum chamber to eliminate air friction on the rotor. The equilibrium position of the rotor was statically and dynamically stable, according to theoretical calculations based on the magnetic-image method. In dynamic tests, the rotor of the diamagnetic bearing was spun up to 100 Hz by a tangential jet of nitrogen gas and then was allowed to spin down freely to measure the rotational losses. The rotational losses varied with the frequency of the rotation, indicating that most of the losses were mainly due to eddy currents. Minor losses due to magnetic inhomogeneities in the permanent magnets and diamagnetic parts were also observed over a small frequency range.