A novel method to reduce the nonlinearity effect of a wavelength scanning diode laser interrogating a low-reflectivity Fabry-Perot interferometer is presented. The interferometer is used for refractive index measurement. The proposed method allows improving the resolution of the system from <inline-formula xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink"> <tex-math notation="LaTeX">$3\times10$ </tex-math></inline-formula> <sup xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">−4</sup> to <inline-formula xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink"> <tex-math notation="LaTeX">$2\times10$ </tex-math></inline-formula> <sup xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">−5</sup> ; and generates a temperature insensitive sensing system. Using the resolution improvement and the temperature insensitivity, the proposed system was used to measure the thermo-optic coefficient of two liquid samples with well-known refractive index. To demonstrate the reliability of the proposed system, experimental results of the long-term performance of a six-month interval, using the same samples but different sensing heads, are presented. The proposed method allows the implementation of a standard four-pin diode laser as an optical source and a standard PIN photodetector for signal detection; permitting the implementation of a high-performance fiber sensor system based on small, light, and standard optoelectronic components. These characteristics are important for different applications such as medical and aerospace, for example, to monitor strain, curvature, pressure, and refractive index using fiber interferometers.