As fiber Bragg grating (FBG) could be damaged by thermal loads or thermal stress when embedded in metals,FBG coated with nickel was packaged on surface of a 316 stainless steel substrate by laser welding. In order to solve the thermal-stain cross effects of the FBG,a smart cantilever beam was fabricated based on temperature compensation principle. Results show that the metal coated FBG can be well bonded with the stainless steel substrate. Temperature sensing property of the packaged FBG was studied within the temperature range of 23～47℃. Temperature sensitivity of the packaged FBG is 22.15 pm/℃,which is about 2.34 times as that of the bare FBG. Strain sensing property of the packaged FBG was studied under the constant ambient temperature conditions and variation temperature conditions. In both of the cases,the wavelength of the packaged FBG and strain show linear trends,and the strain sensitivities are -2.24 pm/g and -2.27 pm/g,respectively. The smart cantilever beam shows excellent accuracy in monitoring strain and temperature simultaneously,which could meet the requirements of engineering applications.