An optical transducer includes a base member, a light source carried on a face of the base member, a light detector carried on the face of the base member laterally spaced from the light source, an optical shield extending from the face of the base member between the light source and light detector, and a displaceable member overlying, and spaced from, the light source, light detector and optical shield, and effective to reflect light from the light source to the light detector. The optical shield includes a transparent plate extending from the face of the base member between the light source and light detector, and carrying a thin layer of a light-blocking material to shield the light detector from direct exposure to the light source. The light source, light detector, and optical shield are all embedded in a transparent plastic potting material. Also described is a method of making such optical transducers by producing an intermediate matrix of a plurality of such light sources, light detectors and optical shields and cutting the matrix into individual optical units.