The proposed paper addresses the problem of modeling and analysis of controlled multibody systems with embedded magnetostrictive transducers. Main emphasis is put on the modeling of the considered mechatronic systems for applications in the field of power harvesting from vibrations, namely vibration-to-electric energy conversion, using novel giant magnetostrictive materials. Mathematical model of the considered mechatronic system has been developed. It comprises the constitutive equations of magnetoelastic behavior of magnetostrictive rod (active element of transducers), standard formulae of electromagnetism for induced voltage and current in the pick-up coil due to variation of magnetic field intensity, and finally the equations of motion of multibody system itself. The last one can be derived using one of the well-known multibody dynamics formalism. Assuming that massinertia parameters of magnetostrictive transducers are negligible small the inverse dynamics based algorithm has been proposed for modeling the controlled motion of multibody systems with embedded transducers. This algorithm is also suitable to evaluate electrical power output of magnetostrictive electric generators for different controlled motions of the system and to optimize the generators design. The inverse dynamics based algorithm was implemented in Matlab/Simulink with user friendly interface. Its efficiency has been confirmed by simulation of performance of different magnetostrictive electric generators under the periodic excitations exerted by the hosting multibody system