Abstract: A differential system is provided that includes a housing defining an interior cavity. The housing can have a bore communicating with the interior cavity. A pair of pinion gears can be positioned within the interior cavity and rotatably coupled to the housing. First and second side gears positioned within the interior cavity are in meshing engagement with the pinion gears and rotatably coupled to the housing. A moving member is configured to rotate with the housing and move between an engaged position and a disengaged position. The housing can be drivingly coupled to the first side gear when the moving member is in the engaged position. An electromagnetic actuation coil is positioned so as to not rotate with the housing and is configured to generate a magnetic field so as to cause the moving member to move from the disengaged position to the engaged position.