Optical fiber methane gas sensing system based on differential absorption was investigated. Two distributed feedback laser diodes were used in the system. The wavelength of the reference light source was 1551nm and the wavelength of the measurement light source was 1653nm, which was located around the absorption peak wavelength of methane. The methane absorption peak was detected by scanning the wavelength of the measurement light source, and then the concentration of methane was measured by comparing the output power at the absorption peak with that not at the absorption band. The system possesses the properties of high resolution, good stability and a measurement resolution of 0.038% is achieved for methane detection.