We report a switchable dual-wavelength fiber grating laser in linear overlapping cavity. The laser features two overlapping cavities sharing a single Yb-doped gain medium fiber and two sets of fiber Bragg gratings. A coiling fiber setup is inserted into the 1035 nm laser cavity. Given that the bending loss is inversely related to the bending radius, the cavity loss of 1035-nm can be modulated. Modulating the bending loss facilitates the switching of the fiber grating laser to a single-or dual-wavelength output at 1030 or 1035 nm and convenient tuning of the power ratio of the two wavelengths. An approximately 152.6-mW output power and up to 38-dB polarization extinction ratio are observed. The simultaneous lasing at 1030 and 1035 nm is a qualified seeder source for amplification to high power scale and can be applied to difference frequency generation of a terahertz signal. This dual-wavelength fiber grating laser is a potential pump source for generating terahertz radiation using a novel approach.