This paper presents the design and development of a coplanar capacitive proximity sensor for the detection of the gap between the edges of dielectric foils. The finite element analysis is applied to study the design of the sensor by investigating the effects of different physical parameters, like, the sensing electrodes width, the spacing between them and the thickness of the substrate on its responses. The sensitivity of the sensor increases with the ascending electrode width; but is negatively affected by the growing spacing between electrodes. Conversely, the foil edge gap detection range rises with the growing electrode width and spacing between electrodes. Moreover, the optimum sensor performance is observed for the foil edge gap positioned centered with the sensing electrodes and the target foil remaining in contact with its surface. The capacitive proximity sensor with optimum set of parameters is fabricated on a polyimide foil by the inkjet of the sensing electrodes. The sensor demonstrates an average optimum sensitivity of 0.105 fF/μm for an edge gap detection range of 500 µm with a 450 µm thick polyethylene foil, when the vertical gap between the foil and the active area of the sensor is maintained to zero. The sensitivity and the detection range capability reduce significantly with the increasing vertical gap between the sensor and foil.