Abstract. High-precision optical measurements depend on the optical sensor's stability. Light source's intensity fluctuations are the dominant cause for output instability of the sensor. In order to address this issue, we have developed an optical sensor for reducing influence of the intensity fluctuations on the output stability. The sensor comprises a light source generating smoothly modulated intensity, a measuring channel, a reference channel, and a beam splitter dividing the light source intensity between the channels. The reference channel opens the measuring channel when the light source intensity equals a specific value and the measuring channel converts the input intensity into the output of the sensor. The sensor was designed and studied experimentally at a wavelength of 635 nm and a modulation frequency of 285 Hz. With the sensor, the influence of the intensity fluctuations on the output stability was reduced 110 times and the relative rms instability of 4.5 × 10 −5 was obtained. Techniques to achieve the instability of 1.0 × 10 −5 are also shown.