This paper presents a method to improve the dynamic range of white light interferometer (WLI) based polarization mode coupling (PMC) measurement system beyond 100 dB. The limitation of interference beat noise is overcame by analyzing in detail the inherent noises that have impacts on the detection sensitivity. An improved PMC measurement system and method are proposed for testing ultra-high polarization extinction ratio (PER) of polarization-related devices. The method can improve dynamic range dramatically through eliminating interference beat noise and enhancing the tested interference intensity simultaneously, which are verified theoretically and experimentally. In addition, a Y-junction with ~80 dB PER of LiNbO3 chip corresponding to a weak signal is tested as an application example. The results demonstrate that the high PER interferogram can be identified clearly and steadily with standard deviation 0.9 dB (3σ) @ ~80 dB. This proposed method is highly beneficial in fabrication and evaluation for polarization devices with ultra-high PER.