A significant problem in the concurrent application of transcranial magnetic stimulation (TMS) and functional magnetic resonance imaging (fMRI) is the image artefact caused by the effect of the TMS-coil on the homogeneity of the static magnetic field (B0). The resulting field inhomogeneity can lead to spatial distortions and local signal loss in echo-planar (EP) images. Here we demonstrate that passive shimming using thin patches of austenitic stainless steel can reduce the effect of the TMS-coil on B0 by ~80%, thus essentially eliminating the associated artefact. Initially the effect of the TMS-coil on B0 was measured using the phase of gradient echo images. Consequently the ideal distribution for the steel was simulated using the magnetic properties of the steel and the effects of the TMS-coil. Finally we demonstrate the effect of two different implementations of the passive shim on a spherical phantom and in vivo.