An ultracompact, cost-effective, and highly accurate fiber optic temperature sensor is proposed and demonstrated. The sensing head consists of Fabry-Perot microcavity formed by an internal mirror made of a thin titanium dioxide (TiO2) film and a microscopic segment of single-mode fiber covered with Poly(dimethylsiloxane) (PDMS). Due to the high thermo-optic coefficient of PDMS the reflectance of the fiber-PDMS interface varies strongly with temperature which in turn modifies the amplitude of the interference pattern. To quantify the changes of the latter we monitored the visibility of the interference pattern and analyzed it by means of the fast Fourier transform. Our sensor exhibits linear response, high sensitivity, and response time of 14 seconds. We believe that the microscopic dimensions along with the performance of the sensor here presented makes it appealing for sensing temperature in PDMS microfluidic circuits or in biological applications.