This paper presents a method of reel-to-reel femtosecond laser direct writing that enables the continuous inscription of low-loss and high-temperature stable Rayleigh scattering centers inside the core of single-mode optical fibers for distributed temperature sensing up to 1000°C. By examining the correlation between the Rayleigh backscattering profile and the cross-section morphology of femtosecond laser-induced nanograting in fiber cores, this paper reveals the mechanisms that underlie the fabrication of high-temperature stable distributed fiber sensors with low loss. By fine-tuning laser exposure conditions, the femtosecond laser-fabricated Rayleigh scattering enhanced section could achieve an optimized propagation loss of 0.01 dB/cm with an increased signal-to-noise ratio of over 35 dB for meters of lengths. Long-term high-temperature stability of the Rayleigh scattering enhanced section was successfully demonstrated, with improved thermal stability and signal-to-noise ratio. The fabrication method presented here provides a promising technique to improve the performance of Optical Frequency-Domain Reflectometry based distributed sensing for harsh environment applications.