A method for seepage and settlement monitoring in earth embankment dams using fully distributed sensing along optical fibres is proposed. A model is developed for simulating and monitoring seepage and settlement systems. This model relates the strains and the temperature changes to the fiber Brillouin gain spectrum in the embankment dam embedding the optical fiber sensors. The model consists of two parts. Submodel 1 addresses the simulation of seepage inside the embankment dam. Submodel 2 relates the measurement of the fiber Brillouin gain spectrum to the changes in temperature and strain inside the embankment dam. Both the changes in temperature and strain during the process are used to reveal serious seepages and settlements occurring inside the embankment dam. The continuously decreasing temperature curve shows an abrupt dramatic increasing rate, which shows that the change is not caused by the temperature of the seepage water but the strain. In this paper, as an example, a model filled with the soil from Yellow River is built and bare optical fibers are embedded under different soil layers near the seepage path. The simulated seepage flows under various flow rates are monitored using the optical fibers and measured by a DiTeSt -STA202 distributed temperature and strain analyzer. A partial settlement within the embankment dam model is observed.