The purpose of this paper is to propose an online noncontact method for measuring the radial rotation error of the spindle and verify the accuracy of the method. This method used a circular grating, two reading heads, an annular plane mirror, and a laser autocollimator. First, the circular grating and annular plane mirror were mounted on the spindle, and the installation error was calibrated in the double center device. Then, the spindle was mounted on the turntable, the double reading head was mounted on the diameter, and the autocollimator was mounted under the flat mirror. During the spindle rotation process, the double reading head could measure the radial motion error of the spindle, and the autocollimator could measure the yaw angle error in the direction of the radial motion error of the spindle. Finally, the radial rotation error of each point of the spindle axis could be calculated according to the radial motion error of one point on the spindle and its yaw angle error in this direction. The results show that within ±12 μm spindle radial rotation error measurement range. The residual error of the proposed method compared with the conventional method is within 1 μm, which verifies the accuracy of the method. The proposed spindle radial rotation error measurement method does not need to use standard balls. It is not affected by the surface roughness, roundness, etc., of the spindle. The measuring device can be embedded into the precision spindle rotary-type device to realize the real-time detection of the spindle radial rotation error.