The generation and reduction reaction of magnesium plasma were studied using a cylindrical transverse magnetic-mode applicator in magnetic and electric field modes. By heating Mg powder using the magnetic field mode, plasma was generated with the evaporation of Mg and stably sustained. When the Mg plasma sample was introduced into the reaction zone and exposed to microwave and lamp heating, a reduction reaction of scandium oxide also occurred. The results of this study provide prospects for the development of a larger microwave refining system.