There are many applications for non-contact measurement of the displacement and velocity of moving objects, especially when achieved at low cost. An optical displacement sensor has been developed that can be compared to expensive laser-interferometry sensors, however at a cost compatible with requirements for consumer products. This miniature Laser-Doppler Interferometer works on all light scattering surfaces. The first large-scale application is in PC-mice. The measurement principle employs so-called "Laser Self Mixing", which occurs when laser light scattered on a surface, within the coherence length, is coupled back into the laser cavity. When the object is moving, the back-scattered light is continuously shifting in phase relative to the laser light at the laser mirror. This results in a periodic perturbation of the feedback into the laser cavity, which causes modulations of the light intensity in the cavity. The frequency of these modulations is proportional the speed of the object. A VCSEL, optimized for this application, is used as light source, a photo-diode in the sensor measures the intensity fluctuations and, finally, an integrated circuit transfers the photo-diode signal into velocity or displacement information. To determine the direction of the movement, a triangle modulation of the laser-current is used, which modulates the laser-temperature and hence the laser frequency. Next to the applications in PC-mice a much wider range of applications as input device in consumer products can be envisaged. For instance menu navigation by finger movement over a sensor in remote controls, mobile phones and lap tops. Furthermore a wide field of applications is envisaged in the manufacturing of industrial equipment, which requires non-contact measurement of the movement of materials. The small form factor of less than 0.2 cubic centimeters allows applications previously considered impossible.