A vehicular sensing system includes a sensing device disposed at a vehicle door of a vehicle. The sensing device includes a sensor element and at least one light emitting diode (LED) disposed at a circuit board. The sensing device is disposed behind a panel of the vehicle door of the vehicle, with the sensor element and the at least one LED being disposed at a light transmitting portion of the panel of the vehicle. The vehicular sensing system, responsive to processing at the controller of captured sensor data when the sensor element and the at least one LED are powered, determines a user input corresponding to a particular location and movement of a user's hand at or near the sensing device. The vehicular sensing system, responsive to determining a particular user input of a plurality of user inputs, provides an output.