In order to improve the demodulation sensitivity and range of fiber Br agg grating (FBG) vibration demodulation system and eliminate the influence of ambient temperature on demodulation signal,a fiber B ragg grating vibration demodulation system with temperature compensation is developed.Using two transmission mode matching FBGs with center wavelengths symmetrically located at both sides of that of the sensing FBG,two symmetrical and complementary sensi ng channels are established in the system and then the vibration demodulation is realized based on difference principle .The system per formance is simulated by Matlab software and the results show that compared with traditional method,the proposed method can effe ctively improve the demodulation sensitivity and range of the system.The matching FBGs are packaged together with a thermoelectri c cooler (TEC) and a ju dging channel of temperature compensation is established.When the output of judging channel exceeds the threshold set previo usly for temperature regulation judgment,the center wavelengths of matching FBGs are re-matched with the sensing FBG by changing th e package temperature of matching FBGs with TEC controller,thereby realizing the temperature compensation of the system.Th e experimental results show that the normalized system demodulation sensitivity is 5.168/nm,the demodulation range is 1.2nm, and the normalized threshold voltage of judging channel is 0.8905.The feasibility of system temperature compe nsation and judgment mechanism is demonstrated by measurement of the same vibration signal under four different environment temperatures using th e developed demodulation system