The need for simultaneous measurement of multiple degree-of-freedom (DOF) motions can be found in numerous applications such as robotic assembly, precision machining, optical tracking, wrist actuators, and active joysticks. Conventional single-axis encoders, though capable of providing high-resolution (linear or angular) measurements, rely on mechanical linkages (that often introduce frictions, backlashes, and singularities) to constrain the device so that the three-DOF (3-DOF) motion can be deduced from the individual orthogonal measurements. We present here a non-contact optical sensor for 3-DOF planar and spherical orientation measurements. We begin with the operational principle of a microscopic-surface-based optical sensor. The design concept and theory of a dual-sensor system capable of measuring 3-DOF planar and spherical motions in real time are then presented. Along with a detailed analysis, the concept feasibility of two prototype 3-DOF dual-sensor systems for measuring the instantaneous center of rotation and the angular displacement of a moving surface is demonstrated experimentally. It is expected that the analysis will serve as a basis for optimizing key design parameters that could significantly influence the sensor performance.