This chapter discusses the development of a low-cost vision-based mobile robot created indigenously in a laboratory. It describes two microcontroller-based sensor systems that were developed for the robot: 1) An IR range finder system with dynamic range enhancement capability using a PIC microcontroller. This system enhances the sensor range from 25-50cm to 10-50cm. 2) An optical proximity detector system utilizing switching-mode synchronous detection to operate accurately under varying ambient light conditions. The chapter provides details on the design and experimental results of these sensor systems.