We present a multi-resolution approach for 3-D magnetotelluric forward modelling. Our approach is motivated by the fact that fine-grid resolution is typically required at shallow levels to adequately represent near surface inhomogeneities, topography and bathymetry, while a much coarser grid may be adequate at depth where the diffusively propagating electromagnetic fields are much smoother. With a conventional structured finite difference grid, the fine discretization required to adequately represent rapid variations near the surface is continued to all depths, resulting in higher computational costs. Increasing the computational efficiency of the forward modelling is especially important for solving regularized inversion problems. We implement a multi-resolution finite difference scheme that allows us to decrease the horizontal grid resolution with depth, as is done with vertical discretization. In our implementation, the multi-resolution grid is represented as a vertical stack of subgrids, with each subgrid being a standard Cartesian tensor product staggered grid. Thus, our approach is similar to the octree discretization previously used for electromagnetic modelling, but simpler in that we allow refinement only with depth. The major difficulty arose in deriving the forward modelling operators on interfaces between adjacent subgrids. We considered three ways of handling the interface layers and suggest a preferable one, which results in similar accuracy as the staggered grid solution, while retaining the symmetry of coefficient matrix. A comparison between multi-resolution and staggered solvers for various models shows that multi-resolution approach improves on computational efficiency without compromising the accuracy of the solution.