This semester project consisted of developing a relative positioning system for mobile robots that uses modulated infrared or visible light to determine the range and direction to a modulated source. Prototype hardware was designed, assembled, and tested to demonstrate the system. The sensor is insensitive to ambient light differences and other environmental factors. The system allows for low bandwidth communication between a source and receiver and can also be used to detect obstacles (using an onboard transmitter). The device is smaller than existing systems, and be easily adjusted to suit new environments.