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Choose by what the measurement must answer: a laser distance sensor measures how far away a target is — for positioning, level-by-distance and presence-at-range, typically over metres to hundreds of metres; a laser displacement sensor measures how far a surface moves — for precision thickness, height, flatness and position-change measurement, typically over millimetres with high resolution; LiDAR scans a field to build a point cloud — for area detection and profiling rather than a single-point value. The three share a light source, not a purpose.
Distance = "how far", displacement = "how much did it move", LiDAR = "what does the area look like". The task, not the technology name, drives the choice.
Physics follows purpose: distance sensors typically use time-of-flight (long range, modest resolution); displacement sensors typically use triangulation (short range, high resolution); LiDAR adds scanning to either principle (field of view, point cloud).
The specification terms are not interchangeable: measuring range, accuracy, repeatability, resolution, linearity, response time, sampling rate — compare like with like, per the candidate model's datasheet.
Target surface is a selection input for all three: dark, glossy, transparent or angled surfaces change achievable performance; validate with the real target.