This study introduces an all-fiber optic sensing network based on fiber Bragg grating (FBG) technology for structural health monitoring (SHM) of launch vehicle payload fairings un-der extreme thermo-mechanical conditions. A wavelength–space dual-multiplexing ar-chitecture enables full-field strain and temperature monitoring with minimal sensor de-ployment. Structural deformations are reconstructed from local measurements using the inverse finite element method (iFEM), achieving sub-millimeter accuracy. High-temperature experiments verified that FBG sensors maintain a strain accuracy of 0.8 με at 500 °C, significantly outperforming conventional sensors. Under 15 MPa mechanical loading and 420 °C thermal shock, the fairing structure exhibited no damage propagation. The sensing system captured real-time strain distributions and deformation profiles, con-firming its suitability for aerospace SHM. The combined use of iFEM and FBG enables high-fidelity, large-scale deformation reconstruction, offering a reliable solution for reusa-ble aerospace structures operating in harsh environments.