We present an investigation of bias drift caused by the Faraday effect in differential fiber optic gyroscope (DFOG) based on dispersion compensation factor and broadband source (BS) parameters. The theoretical model of bias drift is established and the influence of dispersion compensation factor and BSs on the bias drift is revealed. The DFOG prototype is designed by optimizing the dispersion compensation factor and two BSs parameters. Then, the bias drifts caused by the Faraday effect in the DFOG and the traditional single-source fiber optic gyroscope (SFOG) are tested and compared. The bias drift caused by the axial magnetic field in the DFOG is about 0.0072 deg/h for 1Gs, which is about 1/22 of the SFOG. The bias drift caused by the radial magnetic field is about −0.0059  deg  /  h for 1Gs, which is about 1/16 of the SFOG. A discovery is that the bias drift caused by the Faraday effect in DFOG can be suppressed by optimizing the dispersion compensation factor and the two BSs parameters.