Distributed optical fiber sensing technology can obtain the parameters of strain, temperature, and vibration along the sensing direction of a structure, and it is especially suitable for linear engineering monitoring. In this study, the failure condition of pipeline structure is determined by multi-parameter monitoring of strain, temperature, and vibration in a pipeline, and the applicability of sensing each parameter in judging pipeline structure failure is analyzed. The test results show that pipeline damage under different conditions can be identified by strain, temperature, and vibration sensing. There is soil falling in the damaged area, which results in local negative strain of the pipeline. Under active heating conditions, when the pipeline is full of water, the temperature of the optical cable in the damaged area is higher than that in other areas, and when the pipeline is not filled with water, the temperature of the optical cable in the damaged area is lower than that in other areas. The peak vibration frequency of the optical cable in the damaged area of the pipeline is offset from that in other areas. Strain, temperature, and vibration signal sensing can be used to locate the pipeline failure area accurately, with a positioning accuracy of ±1 cm, and a reasonable combination of sensing parameters can aid in monitoring actual pipeline structure failure precisely. These results provide a reference for the application of distributed optical fiber technology in the structural health monitoring of urban buried water pipelines, and this technology has a good development prospect.