Satellite observations of the geomagnetic field contain signals generated in Earth's interior by electrical currents in the core and by magnetized rocks in the lithosphere. At short wavelengths the lithospheric signal dominates, obscuring the signal from the core. Here we present details of a method to co-estimate separate models for the core and lithospheric fields, which are allowed to overlap in spherical harmonic degree, that makes use of prior information to aid the separation. Using a maximum entropy method we estimate probabilistic models for the time-dependent core field and the static lithospheric field that satisfy constraints provided by satellite observations while being consistent with prior knowledge of the spatial covariance and expected magnitude of each field at its source surface.