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After ending his footballing career, Stensgaard finished his cand.jur. education. He was the first in Scandinavia to specialize in business conflict mediation, and he was on the winning team in the 2004 International Negotiation Competition. He served as an International Negotiation Competition judge, and has lectured at the University of Copenhagen. He is also a FIFA-licensed football player agent, and acts as a mental coach for both athletes and businessmen.

He signed a six-month deal with Danish Superliga club F.C. Copenhagen (FCK) in May 1998. He replaced injured keeper Karim Zaza, and kept his place in the FCK starting line-up for all 17 games in the first half of the 1998–99 Superliga season. When his contract expired in December 1998, he moved back to England to play for Southampton on a three-and-a-half-year contract. He spent his time at Southampton as the understudy of Welsh international Paul Jones, and after controversy with manager Dave Jones over missing playing time, he was relegated to third choice goalkeeper. He returned to FCK in July 1999. He played a further 19 games for FCK, but suffered a spinal disc herniation and terminated his career in July 2001, 26 years old.

He was declared a footballing invalid in July 1996, aged 21, and his Liverpool contract was mutually terminated after more than a year on the sidelines. He returned to Denmark, and became the goalkeeping coach of Hvidovre IF, coaching later Liverpool goalkeeper Jørgen Nielsen. In May 1997, he requested his licence from Liverpool in order to become backup keeper for Hvidovre, but refused to play when given the opportunity, as he still feared for his shoulder. With medical help and Olympic medalist Arne Nielsson as his mental coach, Stensgaard then aimed to reignite his active career.

Stensgaard got his national breakthrough with Hvidovre IF, and was touted the successor of former Hvidovre and Danish international goalkeeper Peter Schmeichel. He made his Denmark national under-21 football team debut in October 1993. In May 1994, he was bought by English team Liverpool for a transfer fee of £400,000.

Michael Stensgaard (born 1 September 1974) is a Danish former footballer and business conflict mediator. Playing in the goalkeeper position, he represented Danish clubs Hvidovre IF and FC Copenhagen, as well as Liverpool and Southampton in England. He played eight games for the Denmark national under-21 football team. After ending his footballing career in 2001 due to injuries, he studied Cand.jur. with a degree in business conflict mediation.