In the polarization coupling measurement system using white light interferometry (WLI), birefringent dispersion would broaden the envelope of the interference pattern along the polarization maintaining fiber (PMF), which leads to a noticeable decline of the spatial resolution and the available measurement ranges of the system. To reduce the influence of birefringent dispersion, a new method is proposed for compensating the dispersion phase in frequency domain. By multiplying the dispersed spectral phase and the compensating phase, which is extracted by dividing the width of the principal maximum, we can obtain the non-dispersed signals with inverse Fourier transform. In the experiment, 400 m and 1000 m long fiber was tested respectively, and the birefringent dispersion coefficient of the fiber was obtained as 0.0116×10-9 ps/(nm·km). The spatial resolution of the coupling point at 1000 m PMF was improved from 62.85 cm to 6.03 cm. This makes the fast and real-time compensation of any dispersion in long distance fiber be possible.