A contactless sensor utilizes analog and digital circuitry to provide direct interchangeability with a simple potentiometric sensor, matching all of the electrical properties of a potentiometer, including supply voltage range, power supply current, output voltage range, and having three connection terminals. The contactless sensor operates with voltages from 2 to 30 volts direct current, which includes all of the common industrial sensor power supply voltages: 5V, 10V, 24V, and +/− 15V. The contactless sensor utilizes a total current of less than 0.005 amperes, and its output voltage range includes the power supply rails. These improvements combine to enable the contactless sensor to be a direct replacement when a potentiometric sensor is removed from service.