An improved insertion set is provided for transcutaneous placement of a sensor such as a glucose sensor at a selected site within the body of a patient. The insertion set comprises an insertion needle extending through a mounting base adapted for mounting onto the patient's skin. A flexible thin film sensor includes a proximal segment carried by the mounting base and adapted for electrical connection to a suitable monitor or the like, and a distal segment protruding from the mounting base with sensor electrodes thereon for transcutaneous placement. The distal segment of the sensor and a distal segment of the insertion needle are positioned within a flexible cannula which extends from the mounting base, whereby placement of the mounting base onto the patient's skin causes the insertion needle to pierce the skin for transcutaneous placement of the cannula with the sensor therein. The insertion needle can then be withdrawn from the cannula and the mounting base to leave the sensor distal segment at the selected insertion position, with the sensor electrodes being exposed to patient blood or other extracellular fluid via a window formed in the cannula. The cannula is carried by the mounting base to insure alignment of the sensor electrodes with the cannula window.