When it was leading prospecting in tunnel by TEM, the induced eddy current field would be produced on both side faces of a tunnel at the instant of disconnection of the excitation current. The receiver coil received the superposition of the eddy current field in the entire surrounding space, which was different from the superposition of eddy current field only with ground half-space. Using ANSYS computer program numerical simulated the propagation characteristic of transient electromagnetic fields in tunnel and compared the results on ground half-space with that in tunnel whole-space. The response curves were drawn by changing the depth of an abnormal body and the eigenfunction was obtained by fitting the curves. The results showed that the propagation in tunnel indicated “water wave effect” other than “smoking ring effect” on ground and the low conductivity body in tunnel changed the time-domain property of eddy current and displayed different curves.