This paper describes the evaluation of a fiber-optic reflective displacement sensor that is compensated for variations in light source intensity, pressure, temperature and opacity of ambient medium. Additionally, the distance information is averaged over several points on the target surface, which reduces signal fluctuations due to inhomogeneities. Furthermore, a practical optical fiber reflective sensor model of measuring oil film thickness for thrust bearing is set up in this paper. Actual measurements were made with HEC 3000 tons' thrust bearing and the results were in good agreement with theoretical calculations.