A fiber-optic polarimetric strain sensor of l(S)=10-cm sensing length with three-wavelength passive quadrature digital phase demodulation is investigated. The demodulation unit uses a superluminescent diode light source with narrow-band interference filters in front of the photodiodes and real-time processing of the interference intensities by an arctan-phase-stepping algorithm. Quasi-static strain sensing is performed during slow periodic compression of a composite reinforced plastic rod with a sensor glued to its surface. The measured displacement sensitivity of delta?/deltal=125 mrad/mum, with a resistive strain gauge as a reference, agrees well with the value of 119 mrad/mum previously determined by fringe-distance measurement [Bock et al., Pure Appl. Opt. 5, 125 (1996)]. Despite a coherence-limited fringe contrast of only a few percent, a linearity of the phase-strain characteristic of the order of 1% and a strain resolution of 2.5muepsilon are demonstrated.