A two-wave mixing (TWM) interferometer using photorefractive (PRC) InP:Fe crystal is configured to demodulate the spectral shift of a fiber Bragg grating (FBG) sensor. The FBG is illuminated with a broadband source, and any strain in the FBG is encoded as a wavelength shift of the light reflected by the FBG. The wavelength shift is converted into phase shift by means of an unbalanced TWM interferometer. TWM wavelength demodulation is attractive for monitoring dynamic strains because it is adaptive and multiplexable. Adaptivity implies that it can selectively monitor dynamic strains without active compensation of large quasi-static strains and large temperature drifts that otherwise would cause system to drift. Multiplexability implies that several FBG sensors can be simultaneously demodulated using a single demodulator. TWM wavelength demodulation is therefore a cost-effective method of demodulating several spectrally encoded FBG sensors.