Abstract: The demodulation technology based on the Mach-Zehnder and Sagna mixed interferometer distributed optical fiber leak detection system was studied.The theory of phase generated carrier (PGC) demodulation technology was researched and analyzed. According to the characteristics of the selected leak distributed optical fiber sensor, we designed and tested the hardware circuit of PGC demodulation. The experiment signals to be measured are 0~50 kHz, the carrier frequency is 300 kHz and the cut-off frequency is 50 kHz. After phase shifting the correlation coefficient of signals to be measured is 0.95 and the harmonic distortion is less than 3%, the absolute positioning error of demodulation positioning system at the leak location of 7.865km is 235m, the relative positioning error is 2.35%.This demodulation positioning system has stability and anti-interference performance.