Abstract: Interpolating two-channel orthogonal fine code signals is usually applied in the photoelectric encoders to get high resolving ability, and to better perfect the interpolation technique, special research was carried out on two interpolation methods which were based on triangular waveforms and sine-cosine waveforms. Analysis was implemented separately on ideal signals where several typical errors existed, including direct current drift, amplitude error, fundamental phase error and higher harmonic error, and anti-interference ability was compared between the two different waveform interpolation methods. The photoelectric encoder with fine code signal between sine-cosine waveform and triangular waveform was tested, and for the same encoder, the accuracy was 36 when interpolated with sine-cosine waveforms, and 42 with triangular waveforms. Results demonstrate that, the anti-interference ability of interpolation method based on sine-cosine waveforms is better than that based on triangular waveforms. When developing and manufacturing high-accuracy photoelectric encoders, it is suggested that sine-cosine waveforms should be used in the interpolation of fine code signal, or launch interpolation till the actual signal is calibrated to standard sine-cosine waveforms.