We study the effect of magnification in the Dark Energy Survey Year 3 analysis of galaxy clustering and galaxy-galaxy lensing, using two different lens samples: a sample of luminous red galaxies, redMaGiC, and a sample with a redshift-dependent magnitude limit, MagLim. We account for the effect of magnification on both the flux and size selection of galaxies, accounting for systematic effects using the Balrog image simulations. We estimate the impact of magnification on the galaxy clustering and galaxy-galaxy lensing cosmology analysis, finding it to be a significant systematic for the MagLim sample. We show cosmological constraints from the galaxy clustering autocorrelation and galaxy-galaxy lensing signal with different magnifications priors, finding broad consistency in cosmological parameters in ΛCDM and wCDM. However, when magnification bias amplitude is allowed to be free, we find the two-point correlation functions prefer a different amplitude to the fiducial input derived from the image simulations. We validate the magnification analysis by comparing the cross-clustering between lens bins with the prediction from the baseline analysis, which uses only the autocorrelation of the lens bins, indicating that systematics other than magnification may be the cause of the discrepancy. We show that adding the cross-clustering between lens redshift bins to the fit significantly improves the constraints on lens magnification parameters and allows uninformative priors to be used on magnification coefficients, without any loss of constraining power or prior volume concerns.