Non-contact Linear Position Sensor

You asked for a linear position sensor and that implies you are not asking for a simple switch that changes state from off to on at a specific point, but gives you a analog voltage proportional to position.

For non contacting measurements you have a few choices:

Optical encoders. These are typically used on CNC or other machines to indicate the precise position of the table or trolley. Many types exist, including some fairly cheap ones (i.e., Absolute Digital Scale) that have a SPC serial data output that you could create an interface to to read the absolute position of the sensor. This may be the most economical way to go, but you need some sort of interface to convert the SPC data to an analog output. A small microcontroller such as a PIC Micro to do that.

Here is a third party SPC interface that may help.

Another accurate sensor is the LVDT (Linear Voltage Differential Transformer). These are more expensive and require a signal conditioner. They can cost hundreds of dollars for the sensor and another $100 for a conditioner amp.

Digikey has an example sensor that measures up to 2" stroke.

You need a signal conditioning amp as well.

Another thought is Hall Effect. However, you will most likely need to make the sensor yourself or pay large sums to get something COTS. The plus side is they can directly provide you with an analog output that is representative of linear position. Longer strokes require some tricks to make them work and can get more complex.

There are dozens of different technologies available for this, but which one you would be best served by is going to depend on a lot of other factors. I would start off by examining your linear motion device. If it is a cylinder (i.e. hydraulic cylinder) and it has or can have a magnet in it (as most now do), they you can get a magnetostrictive linear displacement transducer. That is the standard for that type of application. If it's not a cylinder, a laser or IR sensor might make sense if there is a reasonable target to hit and ultrasonic are good for some applications too, especially those where optics might have issues with reflectivity or refraction. If there is a rotary aspect to the motion device, an encoder would work. You also have to define your needs as well: How accurate? What distance, both minimum and maximum? What kind of environmental issues such as temperature, contaminants, vibration, shock, etc.? How are you going to want to mount it? Does it need to be absolute, meaning it knows where it is immediately when it is powered on?

You still have a lot of work to do before you can get meaningful help.