A proximity sensor with movement detection is provided. The proximity sensor may provide a navigation function in response to movement of an object. The proximity sensor includes a driver operable to generate a current to a plurality of light sources in a particular timing sequence, a photo detector configured to receive light and generate an output signal, a controller configured to report the movement of an object near the proximity sensor if the output signal pattern generated matches one of the output signal patterns from among a set of known output signal patterns. The proximity sensor may be configured to provide a navigation operation when an object moves near the proximity sensor.