We modify the pulse-reference-based compensation technique and propose a low-noise and highly stable optical fiber temperature sensor based on a zinc telluride film-coated fiber tip. The system noise is measured to be 0.0005 dB, which makes it possible for the detection of the minor reflectivity change of the film at different temperatures. The temperature sensitivity is 0.0034 dB/°C, so the resolution can achieve 0.2°C. The maximum difference of the temperature output values of the sensor at 20°C at different points in time is 0.39°C. The low cost, ultra-small size, high stability, and good repeatability of the sensor make it a promising temperature sensing device for practical application.