This paper presents a novel technique to reduce the leakage inductance in transformers for switch mode power supplies. By introducing the leakage inductance shield, that reduces the leakage flux by means of Eddy current shielding, the leakage inductance is reduced by almost 15 % in a transformer for a 100 W, 100 kHz flyback converter. Analysis showed that this reduction in leakage flux is insufficient to fully mitigate the large voltage spikes and ringing in the circuits, caused by the leakage inductance. However, a small improvement in efficiency of a flyback converter can be achieved. It is concluded that the leakage inductance shield is simple to implement and can effectively decrease transformer leakage inductance, additional benefits to reduced electromagnetic interference can be expected as well, but were not proven in this paper.