Fiber bubble microcavity is a sealed, self-contained microcavity formed in optical fibers, which means the environment inside the bubble cavity is isolated from the outside environment. It can have nanoscale wall thickness and atomic scale inner wall smoothness, which benefit to the creation of high-quality fiber Fabry–Perot interferometers (FPI) Till now, microbubble-based FPI has been widely applied for physical parameter sensing, like refractive index, temperature, strain, and pressure. This chapter introduces the new technology of preparing fiber bubble microcavity by arc discharge method, and summarizes different fiber bubble microcavity fabrication techniques and hot melting shaping techniques. Additionally, pressure and strain measurements are performed by the structural properties of the fiber bubble microcavity, and device sensitization technology is suggested along with device optimization scheme, all of which lead to a significant improvement in the sensing sensitivity of the fiber bubble microcavity. The working principles, fabrication methods, and sensing applications of the fiber bubble microcavity based FPI are systematically studied. Furthermore, the optical whispering gallery mode measurement based on fiber bubble microcavity is proved by coupling micro/nano fiber with rectangular microbubble cavity, and the strain regulation of the resonant mode of fiber bubble microcavity is further realized.