So far, a truly distributed and commercialized optical fiber temperature system is based on Raman scattering. The spatial resolution limit of such a system is analyzed in the view of nonlinear fiber optics. It is found that a spatial resolution of 2 cm can be achieved for an 1km multi-mode system of 3.5 pW sensitivity and temperature resolution of ±1℃ within 0～400℃. With a sensitivity of better than 0.5 pW, the spatial resolution of a single-mode system will be better than that of above multi-mode system. Theoretically there is no restriction to introduce such a system into the application of moderate distance and high spatial resolution.