A linear position sensor assembly having a magnetic shield minimizes interference (noise) from adjacent electrical and electromagnetic devices, particularly solenoids. The sensor assembly includes a permanent magnet linear contactless displacement (PLCD) sensor comprising a pair of magnetic field sensors which are spaced apart by a member of high magnetic permeability such as a metal bar. The sensors and metal bar are enclosed, i.e., surrounded on three sides, by a cover or shield of high magnetic permeability material such as steel or mu metal, for example. A permanent magnet is disposed in sensed proximity to the sensors and translates with a clutch actuator component. When the clutch actuator component translates axially, the two field sensors provide a signal to associated electronics having high linearity, low noise and no deadband.