There is provided a method of installing a magnetic proximity sensor including positioning the magnetic field sensor in a desired location and positioning a magnet in a desired location relative to the magnetic field sensor, with an indicator of the sensor continuing to be turned on during the predetermined period of time when the magnetic field generated by the magnet is sensed by the magnetic field sensor, and being turned off during the predetermined period of time when the magnetic field generated by the magnet is not sensed by the magnetic field sensor. The indicator light thus assists in determining proper relative positioning of the magnet and the magnetic field sensor. If after the predetermined period of time more time is needed to install the magnetic proximity sensor, the method includes initiates another predetermined period of time by removing and replacing a lid of the magnetic proximity sensor.