A novel Mach-Zehnder interferometer (MZI) based on tapered-side-hole-fiber (SHF) fiber laser structure, which has obvious advantages in salinity and temperature measurement sensitivity, is analyzed both theoretically and experimentally. The tapered-SHF structure is used as a sensing element and an optical filter, which is connected to the erbium-doped fiber to form a fiber ring laser (FRL). Based on the linear correspondence between the output spectra of the FRL and the salinities, the salinity around the sensing area is measured by the MZI. The FRL has the unique advantages of high resolution, narrow line width, high optical signal-to-noise ratio, and high stability. Compared with the transmission spectrum of conical SHF in the broadband light source, these advantages are more suitable for sensing applications. The experimental results show that the finer the taper diameter, the higher the sensitivity of salinity and temperature. When the taper diameter is 8.23 μm, the salinity sensitivity of the sensor can reach 0.3347 nm/‰, and the temperature sensitivity can reach −0.4270 nm °C