The invention discloses an on-line actual error compensation system of a sine and cosine encoder, which compensates for an error in the subdivision process of improving the resolution ratio of a sine and cosine output encoder on the basis of the subdivision technology of the sine and cosine output encoder so as to improve the accuracy of a feedback value of the encoder. The system has simple implementation, good using effect and excellent adaptability by combining an on-line actual error compensation method of the sine and cosine encoder with an accuracy compensation device of the sine and cosine encode, wherein the accuracy compensation device comprises a difference compensation period generation module, a sine and cosine data sampling and calculating module, an entire period calculating module, a table look-up module, an output mode selection module, a pulse mode output module, a modulus output module, an error table storage module and a summation module; and the system is suitable for the wide popularization in the fields of position measurement, angle measurement and motion control such as numerical control machine tools, high-accuracy measurement instruments and the like which are outputted by using a sine and cosine signal.