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1. Depends whether the sensor's digital input are TTL or CMOS. 5V TTL will work. If 5V CMOS, minimum required voltage is 3.5V, which is more than 3.3V PSoC can provide. You can use external pull-up resistor to correct issue: https://www.allaboutcircuits.com/textbook/digital/chpt-3/logic-signal-voltage-levels/ 2. No, that won't work. Use resistor divider to bring sensor output voltage to <3.3V.