A modified magnetic multipolar plasma source is developed and tested for application as an ion thruster for space propulsion. The configuration consists of eight samarium-cobalt bar-magnets, symmetrically surrounding a cylindrical discharge volume of 21 mm diameter, with their magnetization in the radial direction. A donut magnet is placed at one axial end of the discharge volume with its magnetization along the cylindrical axis. A short monopole antenna, coaxial with the donut magnet is used for launching microwaves in the discharge volume. The resulting magnetic configuration due to the radial and axial magnetic fields, help in generation and sustenance of microwave induced electron cyclotron resonance plasma. Ions are extracted from the plasma by high voltage grids, attached to the end, opposite to the donut magnet. Two different magnetic configurations obtained by reversing the magnetization direction of the donut magnet are compared. Three dimensional magnetic field simulations and ion saturation current measurements at various microwave frequencies are used to determine the optimum magnetic configuration. Ion beam current extraction measurements, using the grids is carried out. Typical ion beam current of 9.9 mA is obtained, with calculated thrust of 0.63 mN at 8 W for 1600 MHz, with a Xenon mass flow rate of 20 μg/s.