The lateral flow of ballast during the passage of trains can reduce the stability of rail tracks. Therefore, it is important to monitor and restrain the movement of ballast accordingly in order to prevent track misalignment. This current study explored the use of optical-Fiber Bragg Grating (FBG) sensors to measure the lateral displacement of unreinforced and geogrid-reinforced ballast. The tests were conducted on fresh latite basalt at a loading frequency of 20 Hz and up to 250 000 load cycles. The test results showed that the FBG sensing system is fully capable of measuring the lateral displacement of ballast under high-frequency cyclic loading. A comparison of strains obtained from FBGs installed at different depths along the ballast depth is made and the lateral strain profiles are measured. Moreover, an empirical model to convert the FBG strains to an equivalent lateral displacement of ballast is proposed to effectively use this technology in real-time monitoring of track deformations.