Femtosecond pulsed laser interferometry has important applications in measuring picometer-level displacements on sub-nanosecond time scales. In this paper, we experimentally examine its achievable displacement resolution, as well as the relationship between the laser’s optical spectrum and the interferometer’s effective wavelength. The resulting broadband displacement noise and noise floor of the pulsed laser Michelson interferometer are equivalent to that achieved with a stabilized continuous wave HeNe laser, where values of 1.01 nm RMS and 27.75 fm/√Hz have been demonstrated. It is also shown that a single effective wavelength can accurately describe the fringes of the pulsed laser interferometer but the effective wavelength value can only be determined from the optical spectrum under certain conditions. These results will be used for time-resolved displacement metrology with picosecond temporal resolution in the future.