In accordance with an embodiment, a proximity sensor includes a driver, a photodiode (PD), an analog-to-digital converter (ADC) with analog-to-digital-to-analog (ADA) feedback, and a controller. The driver is adapted to selectively drive a light source. The photodiode (PD) is adapted to produce a photodiode current signal (Idiode) indicative of an intensity of light detected by the PD, where the light detected by the PD can include ambient light and/or light transmitted by the light source that was reflected off an object proximate the PD. The controller is adapted to control the driver and the ADC with ADA feedback. A digital output of the ADC with ADA feedback is indicative of a proximity of an object to the PD with at least a majority of the ambient light detected by the PD rejected.