On the basis of simplified three-layer model, and in two aspects such as refractive index sensing and step-index fiber grating property, the study on using long-period fiber grating as liquid level sensor in theory was made. When the resonance peak loss as a sensing parameter is measured, the overcoupling did not happen, within a wider range, the linear relationship of the resonance peak loss and the percent of the LPG immersed in liquid would become very well. In contrast, the grating peak loss did not correspond with the percent of immersed liquid as soon as the overcoupling happened.