According to the characteristics of the system that the wavelength of the optical signal is calculated by the phase of the modified frequency shift interference system, a digital mixing method based on the modified frequency-shift interference system was proposed, and the FBG wavelength demodulation was experimented. In the demodulation process, the algorithm combines the advantages of the frequency shift interferometric technology to accurately locate the grating, improves the frequency consistency between the local oscillator signal and the original interference signal in the signal mixing stage, and realizes the high-precision phase demodulation of the interference signal. A FBG sensor system was built based on the modified frequency-shift interference structure. In the simulation and experimental test, the wavelength information contained in the initial phase of the interference signal is accurately obtained by digital mixing method. The demodulation error of the 1.5 nm wavelength change signal is less than 0.26%. At the same time, the temperature sensing experiment of quasi dynamic signal is carried out, which has a good effect of wavelength demodulation, and has a certain application prospect in sensor monitoring.