A process of forming an encapsulated magnet assembly is provided, the process comprising welding a second portion of a housing cover formed of a non-magnetic material to a first portion of a housing cover formed of a magnetic material to provide a welded housing cover and subsequently heat-treating the welded housing cover at a temperature effective to relieve weld stress; disposing a magnet within a housing comprising at least one wall formed of the non-magnetic material and defining at least one aperture; and welding the heat treated welded housing cover to the housing such that the second portion of the housing cover is fixedly attached to the housing wall to hermetically seal the aperture. In one embodiment, the magnet of the encapsulated magnet assembly is a permanent magnet, and in an alternate embodiment an electromagnet. In one embodiment the encapsulated magnet assembly is a component of a stator-rotor assembly.