Fibre optic EFPI sensor is usually very small in size while the fault size is relatively big, so it is not suitable to be installed at the fault for the fibre optic EFPI. As a result, fibre optic extrinsic Fabry-Perot interferometer for fault measurement, EFPI was present. EFPI structure is formed as two ceramic ferrule inserted into the ceramic casing from the ends. Two ceramic ferrule are respectively fixed on the two metal inner tube, which are inserted into the metal outer tube form the two ends. O-type sealing rings are put at each end of the metal outer tube, so the EFPI displacement sensor is capable of waterproof and dustproof. In order to eliminate the influence of temperature on EFPI displacement sensor, two metal tubes with different thermal expansion coefficient material are chosen for temperature compensation in the structure. In the experiment, EFPI displacement sensor with 718.39μm of the cavity length was measured in a continuous changing temperature situation. The results shows that temperature coefficient of displacement sensor has declined by 0.14 μm/℃ to - 0.04μm/℃ after temperature compensation, and showed a compensation.