Examined is the influence by input state of polarization and analyzing scheme on sensitivity in the measurement system of beat length that relies on magneto-optic modulation technique in which the magnetic gap and intensity of magnetic field have been given. Through theoretic analysis and experimental study, it is found that there are three experiment schemes getting maximum sensitivity. First, the polarization direction of the input linearly polarized light is at θ = 00 or 900 to the birefringence fast axis of e fiber, at the same time, the two analyzing axes of Wollaston prism are at γ = 450 to the birefringence fast or slow axis of fiber. Second, the polarization direction of input linearly polarized light is at θ = 450, and γ = 00 or 900. Third, the input light beam is circular polarized light, at the same time, γ = 00 or 900. The sensitivity under three cases is approximately equal, but the third scheme needn't pinpoint the direction of birefringence axis of fiber, which makes the experiment more convenient and avoid the measurement error caused by the adjustment of angle.