Magnussen showed immediate speed in junior formulas. He won the 1992 Formula Ford Festival at Brands Hatch, a result that signalled his potential at the international level. In 1994 he dominated the British Formula 3 championship with Paul Stewart Racing, winning fourteen of eighteen races and breaking Ayrton Senna's previous British F3 record. Team founder Jackie Stewart described him as "the most talented young driver to emerge since Ayrton Senna."
Magnussen made his Formula One debut at the 1995 Pacific Grand Prix at Aida, stepping in for an unwell Mika Häkkinen — becoming the first Danish driver to race in Formula One since Tom Belsø in 1974.
For 1997 and 1998 he secured a full-time seat with the newly founded Stewart Grand Prix team, co-owned by his former F3 boss Paul Stewart. Despite high expectations following his British F3 dominance, Magnussen's F1 form was underwhelming. He scored his only championship point in his final F1 race, the 1998 Canadian Grand Prix. For much of that season he was replaced by Jos Verstappen. He started 24 Grands Prix in total.
In 1996 he also competed in the CART series and the International Touring Car Championship.
Magnussen joined Corvette Racing in the early 2000s and built one of the most consistent long-distance records in American sports car history. His Le Mans results with the Chevrolet Corvette were exceptional: he won the GTS class in 2004 alongside Oliver Gavin and Olivier Beretta, took the GT1 class in 2005 and 2006 with Gavin and Beretta again, and claimed a fourth class victory in 2009 alongside Johnny O'Connell and Antonio García.
Beyond Le Mans, Magnussen won the GT1 class at the 12 Hours of Sebring in 2006, 2008, and 2009. He won the 2015 24 Hours of Daytona in the GTLM class. In longer championship terms, he won the GT1 and GT drivers' championships in 2008 and 2013 respectively, both with Corvette Racing.
In the IMSA SportsCar Championship (successor to the American Le Mans Series and Rolex Sports Car Series), Magnussen partnered Antonio García to claim back-to-back championship titles in 2017 and 2018. The pairing drove together in the GTLM class for many seasons and was among the most consistent GT programmes in North American sports car racing.
Magnussen participated in the Danish Touring Car Championship for many years, winning titles in 2003 and 2008. He drove a Toyota Corolla in the series in 2005 and a Chevrolet Lacetti for Perfection Racing in subsequent years.
In June 2010, he made his NASCAR Sprint Cup debut driving the No. 09 HendrickCars.com Chevrolet for Phoenix Racing at Infineon Raceway, starting thirty-second and finishing twelfth.
At the 2010 Rolex 24 at Daytona, Magnussen drove for Stevenson Motorsports in the GRAND-AM Rolex Sports Car Series. In November 2019, he joined the inaugural TCR Denmark Touring Car Series with LM Racing. In July 2023 he won the Aurum 1006 km endurance race in Lithuania in a Mercedes-Benz AMG GT3 Evo.
Magnussen's eldest son Kevin is also a professional racing driver who has competed in Formula One with McLaren, Renault, and Haas, and currently races in the FIA World Endurance Championship and IMSA with BMW. Kevin has cited his father as his earliest racing hero. Magnussen's nephew Dennis Lind and youngest son Luca are also racing drivers.
Magnussen's career is defined by exceptional longevity and consistency at the highest level of GT and sports car racing. Four Le Mans class victories, two IMSA titles, and three Sebring class wins across more than two decades with Corvette Racing place him among the most successful GT drivers ever to represent an American manufacturer.