Rotary encoder is the sensor which could convert the shaft mechanical displacement to digital or pulse signals. On the incremental encoder disc， there are many square holes equally spaced. The rotary encoder could output the pulse signal through the electrical part reading the holes on disc.

Incremental optical encoder is a device converting physical data to digital mode. In the motion control systerm, the function of incremental optical encoder is converting angle and position information to digital pulse signal. The A,B,Z 3 channels output in wave form. Direction and speed can be judged from the 3 channels.