When measuring turbine vibration, it is difficult to accurately measure small displacement because the sensor head is inconvenient to install and the signal is vulnerable to electromagnetic interference in traditional measurement methods. Optical fiber displacement sensor has the characteristics of small volume and being not affected by electromagnetic environment. Through the photoelectric conversion and signal conditioning amplifier it realizes online measurement of steam turbine vibration signals, Combined with LabVIEW software to do curves fitting of noise signal and to do with amplitude frequency characteristics with FFT processing, it eventually obtains high precision micro displacement measurement results. The measurement system has the advantages such as antiinterference, fast measuring speed, realtime recording of data, and it can realize the function of online measurement of micro displacement, the experiment suggests the vibration measurement range of 1~500 μm, accuracy of 05%, and dynamic range <1 kHz, which can meet the needs of the steam turbine vibration test.