Distributed fibre optic sensing (DFOS) is essential for structural health monitoring (SHM) of strain changes induced during the lifetime of a structure. Among different DFOS systems, the Brillouin Optical Time Domain Reflectometry (BOTDR) takes the advantages of obtaining full frequency spectrum to provide strain and temperature information along the optic fibre. The key parameters of distributed fibre optic sensors, spatial and frequency resolution, are strongly linked with the time-frequency (T-F) localisation in the system in three parts: pulse, hardware design and optical fibre. T-F localization is fundamentally important for the communication system, whereas in this study the importance of the T-F localisation to the spatial and frequency resolution, repeatability and the measurement speed are introduced in BOTDR. In this dissertation, the development of DFOS is first introduced, including both traditional methods and new developed designs. The literature review shows the signal to noise ratio (SNR) of BOTDR can be improved by investigating its T-F localisation. In the hardware design, in order to improve the T-F localisation in hardware architecture, a Short-Time Fourier Transform-Brillouin Optical Time-Domain Reflectometry (STFT-BOTDR), which implements STFT over the full frequency spectrum to measure the distributed temperature and strain along the optic fibre, is applied so that the conventional frequency sweeping method can be replaced for high resolution and fast speed measurement, providing new research advances in dynamic distributed sensing. The STFT based BOTDR has better T-F localisation, which in turn provides an opportunity for off-line post signal processing that is more adaptable for fast speed measurements. The spatial and frequency resolution of dynamic BOTDR sensing is limited by the Signal to Noise Ratio (SNR) and the T-F localization of the input pulse shape. The T-F localized input pulse shape can enhance the SNR and the spatial and frequency resolution in STFT-BOTDR. In this study, simulation and experiments of T-F localized different pulses shapes are conducted to examine the limitation of the system resolution. The result indicates that a rectangular pulse should be selected to optimize the spatial resolution and a Lorentzian pulse could be chosen to optimize the frequency resolution, while a Gaussian shape pulse can be used in general applications for its balanced performance in both spatial and frequency resolution. Meanwhile, T-F localization is used for pulse T-F localisation optimisation. A set of Kaiser-Bessel functions is used to simulate different pulse shapes and to compare their parameters in terms of T-F localisation and their Brillouin scattering spectrum. A method using an iterative filtering algorithm to achieve the optimised pulse in terms of T-F localisation is introduced to converge the Effective-pulse Width (TEW) in the time-domain and Effective-pulse Linewidth (FEL) in the frequency domain to identify the fundamental limitations. The optimised pulse can be fitted with a 7th order Gaussian (super-Gaussian) shape and it offers the best experimental performance compared to a Rectangular pulse. The sensitivity of a sensor to strain or temperature variations due to distributed Brillouin scattering is closely related to the power distribution on the Brillouin scattering spectrum which is related to the property of the optic fibre. The performance of a highly nonlinear fibre that can generate a higher Brillouin scattering signal is compared to that of a standard single mode fibre. The results show that much higher SNR of the Brillouin scattering spectrum and smaller frequency uncertainties in the sensing measurement can be achieved by using a highly nonlinear fibre for comparable launched powers. With a measurement speed of 4 Hz, the frequency uncertainty can be 0.43 MHz, corresponding to 10 με in strain or 0.43°C in temperature uncertainty for the tested highly nonlinear fibre. In contrast, for a standard single mode fibre, the value would increase to about 1.02 MHz (25 με or 1.02°C), demonstrating the advantage of the tested highly nonlinear fibre for distributed strain/temperature sensing. Results show that, by using a small effective area highly nonlinear fibre, the strain or temperature resolution can be improved because it generates stronger Brillouin scattering signal with high SNR and high Q factor spectrum, both of which determine the optimal averaging time in a single measurement. In general, the STFT-BOTDR can achieve 1 m spatial resolution, 10 µε frequency resolution on a 10 km fibre with measurement speed at about 2.5 kHz.