A novel and simple highly-sensitive temperature, liquid level and axial strain sensor based on a torsional taper Mach-Zehnder interferometer (MZI) with Vernier effect is proposed. An interesting finding, which is the linear relationships between the wavelength shifts of resonance peaks (envelopes) and temperature, liquid level and axial strain surrounding the sensing fiber, is demonstrated experimentally. Another interesting feature is that the sensor with Vernier effect magnifies the temperature, liquid level and axial strain sensitivities by 11.3, 11.2 and 12.6 times, respectively. In the proposed method, the sensor is fabricated by cascading one polarization mode interferometer (PMI) as reference interferometer and one torsional taper MZI as sensing interferometer. The PMI is composed of polarization maintaining fiber (PMF), and cascaded MZI is composed of thin-core photosensitive fiber (TPSF). Combined with the characteristic of high sensitivity, the sensor can be widely used in the field of environmental and structural safety monitoring.