A unique dynamic frequency-domain interferometer for absolute distance measurement has been developed recently. This paper presents the working principle of the new interferometric system, which uses a photonic crystal fiber to transmit the wide-spectrum light beams and a high-speed streak camera or frame camera to record the interference stripes. Preliminary measurements of harmonic vibrations of a speaker, driven by a radio, and the changes in the tip clearance of a rotating gear wheel show that this new type of interferometer has the ability to perform absolute distance measurements both with high time- and distance-resolution.