An automated system for monitoring and maintaining fluid level in a swimming pool, spa, or other environment containing water is provided. The system includes a sensor assembly having a microprocessor and a proximity sensor encapsulated in a non-conductive material. A lower section of the sensor assembly has a flat profile and at least a portion of the proximity sensor is positioned in the lower section. The sensor assembly transmits a signal to a remote controller when the water level measured is above or below a predetermined target value. The remote controller in turn causes a remote water valve to turn on or off. In certain implementations, the sensor assembly incorporates a precision mounting system and algorithm, which work together to provide the end user with a means to mount the sensor easily and maintain precise operational level of the water. The combination of the physical mounting system and the range and resolution of the proximity sensor allow for precise maintenance of water level at the preferred level.