A distributed vibration sensor based on two-beam interference is proposed and experimentally demonstrated. Optical pulses are launched into two distributed fibers. With the interference effect of two channel Rayleigh scattering signals and the positioning principle of conventional optical time domain reflectometer (OTDR), detection and location of vibration events along sensing fibers can be achieved. A new signal processing method is subsequently utilized to improve the signal-to-noise ratio (SNR) of the signal and reduce the system computation. Experimental results show that the system can effectively detect and precisely positioning the external vibration events with high sensitivity. A validated optimal spatial resolution of 20 m is acquired under testing fiber length of 5 km and the SNR of the differential signal can be as high as 8.5 dB. This new interferometer can be used for long distance monitoring such as pipeline security pre-warning as well as any vibration monitoring.