Systems and methods are disclosed for proximity sensing in physiological sensors, and more specifically to using one or more proximity sensors located on or within a physiological sensor to determine the positioning of the physiological sensor on a patient measurement site. Accurate placement of a physiological sensor on the patient measurement site is a key factor in obtaining reliable measurement of physiological parameters of the patient. Proper alignment between a measurement site and a sensor optical assembly provides more accurate physiological measurement data. This alignment can be determined based on data from a proximity sensor or sensors placed on or within the physiological sensor.