A system and method of sensing temperature at an optical fiber tip, including the steps of positioning a slug of fluorescent material adjacent the optical fiber tip, providing an optical stimulus having a wavelength within a first predetermined range through at least one fiber optically linked to the optical fiber tip, wherein a desired optical fluorescent response having a wavelength within a second predetermined range from the fluorescent slug is generated, detecting a signal representative of the optical stimulus, detecting a signal representative of the optical fluorescent response, digitally processing the optical stimulus signal and the optical fluorescent response signal to determine a phase difference therebetween, and calculating a temperature for the optical fiber tip as a function of the phase difference. The phase difference between the optical stimulus signal and the optical fluorescent response signal may be determined directly or indirectly as a function of the phase difference between a reference signal and the optical stimulus signal and the phase difference between the reference signal and the optical fluorescent response signal.