A tailgate hitch sensor system is installed by mounting a housing around the end of a receiver tube on the back of a hitch, and then plugging the system into both the OEM passenger side tailgate locking mechanism and the OEM driver side tailgate locking mechanism. A magnetically operated reed switch is positioned at the top of the housing, and a cover supporting a magnet is pivotally hinged to the housing so the cover has a normally closed position covering the receiver tube. When the cover is closed, the tailgate operates normally. When the cover is open, the electrical circuit for at least one stage of lowering the tailgate is de-activated.