Time-grating　sensor　is　a　novel　sensor　and　it　can　achieve　very　high　accuracy　owing　to　a　special　way　that　measure　time　using　pulse　with　high　frequency.　In　this　paper,　the　reasons　of　signal　distortion　have　been　introduced　firstly,　including　the　imbalance　of　amplitude,　imperfect　quadrature,　inductive　of　harmonics.　In　particular,　aim　to　the　angular　deviation　from　the　imbalance　of　amplitude,　the　letter　introduces　the　d-q　transform　from　electrical　machinery　to　solve　it　and　deduces　the　angular　deviation.　The　process　of　measuring　is　analyzed　using　rotating　coordinate　system　where　an　error　compensation　algorithm　has　been　proposed.　The　error　would　be　corrected　with　a　simply　way　due　to　the　fact　that　the　algorithm　utilizes　the　characteristic　of　signal　completely.　Finally,　the　proposed　method　was　applied　to　the　experimental　system　and　the　error　of　sensor　was　obtained　under　different　circumstances.　Experimental　results　indicate　the　curve　of　error　consist　of　2th　harmonic　because　of　the　imbalance　of　amplitude.　The　deviation　of　angular　information　from　the　imbalance　of　amplitude　will　be　eliminated　if　the　algorithm　is　applied.　it　will　get　good　result　with　the　algorithm　and　it　will　be　make　sense　for　time-grating　sensor.　©　2017,　Science　Press.　All　right　reserved.