Stanley,

Not being familiar with the sensor, I'm making a suggestion that may not be compatible with it. However -

(1) Decoupling the background from the desired signal -
If the sensor is a light emitting device that can be modulated by firmware or hardware, the receiver can be synchronized to the exciting signal. During the time the transmitter is not emitting light, the receiver can measure the average background light level. During the time the transmitter is emitting light the receiver can measure the average background and the reflected signal. Using a history of the background measurements will give you a good indication of the average background.

(2) Reducing the likelihood of the desired signal to be in synch with the background -
Electronic ballasts for flourescent lights increase the range of switching frequencies that appear as background modulation in ambient light levels. Aggravating the siuation is that ballast manifacturers do not use the same frequency - not to mention other background sources. If the transmitter can be modulated, use a pseudo random noise generator to pulse the light transmitter at an irregular rate and duration. This prevents accidental synchronization of the desired signal with a particular background source. I've used this method to avoid ambient interference and it works well. It is not an original idea. Cell phones, navigation systems and communication technologies use it to eleiminate interference and to operate across a broad frequency range without causing intereference.

Good Luck,

Bruce