Data storage is a problem that cannot be ignored in the long-term monitoring of a phase-sensitive optical time-domain reflectometry (Φ-OTDR) system. In this paper, we proposed a data-reduction approach for heterodyne Φ-OTDR using an ultra-low sampling resolution and undersampling techniques. The operation principles were demonstrated and experiments with different sensing configurations were carried out to verify the proposed method. The results showed that the vibration signal could be accurately reconstructed from the undersampled 1-bit data. A space saving ratio of 98.75% was achieved by converting 128 MB of data (corresponding to 268.44 ms of sensing time) to 1.6 MB. The proposed method led to a potentially new data-reduction approach for heterodyne Φ-OTDR, which also provided economical guidance for the selection of the data-acquisition device.