The LABEL•EYE® is a special purpose gap or slot sensor optimized to sense adhesive labels adhering to a roll of backing paper. The web of labels is directed from a “roll” across a peeler plate or around a sharp edge. As the web passes around the sharp edge of the peeler plate, the adhesive label peels from the backing material. The function of the LABEL•EYE® is to look through the backing paper to detect the “gap” between the labels and signal the labeling machine to stop the dispensing mechanism before the label is completely dislodged from the backing material. With the next “up” label protruding off the end of the peeler plate, it is now perfectly positioned to be applied to the next product as it passes by on a conveyor.