By replacing part of silica cladding of fiber Bragg grating (FBG) with magnetic fluid, a magnetic field sensor with magnetic fluid packaging and thin cladding FBG structure has been fabricated. The response characteristics of the sensor to magnetic field and temperature have been investigated. The results show that the wavelength sensitivity and power sensitivity of the sensor are 34.9 pm/mT and -1.063 dBm/mT respectively in the magnetic field range of 5.0~20.0 mT, and the corresponding linearity of the wavelength shifting with magnetic field change is up to 99.2%. The packaging process does not change the linearity of the FBG wavelength with temperature, but the temperature sensitivity is reduced to 9.2 pm/°C due to the magnetooptical effect of the magnetic fluid. The sensor can realize temperature compensation in magnetic field measurement, and the method is simple and easy to implement.