This study investigates an optical fiber Mach-Zehnder interferometric measurement system for measuring the micro-displacement of a target object. The Mach-Zehnder interferometer structure is used to build a heterodyne laser interferometric optical path. In addition, an acousto-optic frequency shifter is used to modulate the frequency of the reference light, and a photodetector is used to interfere with the measurement light containing the displacement information of the object. To solve the problem of frequency drift of the acousto-optic modulator, the radio-frequency (RF) signal of the modulator is taken as the reference signal. Next, a frequency drift is introduced into the measured and reference signals to give them the same frequency shift error. During phase demodulation of the two signals, the frequency shift errors cancel each other out. The signal demodulation uses a correlation phase identification algorithm that can determine the lead-lag relationship of the signals, and the displacement and direction information of the object is obtained. Experimental results show that in the displacement range of ±25 μm, the maximum and minimum relative errors of displacement are 0.78% and 0.145%, respectively, the fitting coefficient for the linear fit R² is 0.9999, and the displacement consistency error is less than 0.033 μm. The experiments show that the measurement system has good measurement accuracy and stability.