Displacement sensors are important components in many instrumentation systems, but the existing electrical based systems suffer from electromagnetic interference, noise, low response, etc. In the present paper, a magneto-optic element like Terbium Doped Glass (TDG) has been experimentally studied in double pass mode for its use as a displacement sensor. A high sensitive linear (with in ±0.54%) microdisplacement sensor with improved performance over an appreciable range of 10 mm with a resolution of 5 μm is achieved. The theoretical analysis and experimental results are reported in the paper. The experimental data have been found to be in good agreement with the theoretical study. © 2011 Elsevier Ltd. All rights reserved.