A proximity detector device may include a first interconnect layer including a first dielectric layer, and first electrically conductive traces carried thereby, an IC layer above the first interconnect layer and having an image sensor IC, and a light source IC laterally spaced from the image sensor IC. The proximity detector device may include a second interconnect layer above the IC layer and having a second dielectric layer, and second electrically conductive traces carried thereby. The second interconnect layer may have first and second openings therein respectively aligned with the image sensor IC and the light source IC. Each of the image sensor IC and the light source IC may be coupled to the first and second electrically conductive traces. The proximity detector device may include a lens assembly above the second interconnect layer and having first and second lenses respectively aligned with the first and second openings.