The magnetic encoder (ME) always employs sensor passing through periodic and equal distance grating and then generates periodic quadrature scaling signals for displacement measurement. The phase is relative to the movement. To improve encoder accuracy or resolution, electronic interpolation technique had been developed to subdivide the phase of quadrature scaling signals. According to the trends, this paper proposed a specific method with excellent noise immunity characteristic and a complete calibration process to improve the accuracy of the system. The designed circuit is taped-out using TSMC 0.18-μm CMOS process, where the active area is 1643 μm × 1676 μm. The chip has the specification of 3.3 V supply voltage, 20 MHz clock frequency, and 0.0859 mW power consumption. The accuracy of the measurement system is 1.065um.