An optical positioning monitoring system is disclosed. The system has an optical sensing member disposed on a wellbore pipe, such as the tubing or production casing. When a tool comprising an actuating member acts on the optical sensing member, an optical signal is returnable from the optical sensing member indicating the position of the tool. The optical sensing member may include an optical fiber and/or any known optical sensors. The actuating member can be a force applicator or a heat applicator. Alternatively, the optical sensing member can be located on the tool and the actuating member can be located on the tubing or production casing.