Understanding the mechanical characteristics of clayey soil is critical to estimate the stability of clay-related geotechnical engineering works. However, the distributed information of the internal deformation of clay is hard to capture through traditional methods. In this paper, a set of four-point bending tests were performed on a compacted clay beam instrumented with fiber optic strain sensors to investigate the flexure and cracking behaviors. The optical frequency domain reflectometry technique with high spatial resolution and precision was employed to establish a distributed strain sensing (DSS) system in this study. The results show that the DSS system exhibits a high accuracy in the collection of the clay deformation in terms of compression, tension, and cracking. The comparison of the internal strain profiles with the observation of particle image velocimetry analysis system verifies the feasibility of fiber optic sensing technology in the quantitative assessment of clay deformation. The performance of fiber optic sensors in the rebound deformation and creep deformation monitoring was preliminarily issued in the study. In addition, the progressive failure on the fiber–soil interface was analytically studied to evaluate the deformation compatibility between the fiber and surrounding clayed soil. The conclusions drawn in this paper can help to guide the state interpretation of clayey soil instrumented with fiber optic sensors.