Incremental Optical Encoders
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The incremental optical encoders use a much simpler disc pattern. This slotted rotor disc alternately interrupts the light beam between the LED transmitter-receiver pair and thus produces a pulse output. The number of pulses depends on the number of slots on the disc. The pulses are then fed to a counter, where they are counted to give position information. The pulse rate indicates shaft speed. An additional LED pair can also determine the direction of rotation. Some modules also provide a marker pulse output, which is generated once every revolution at a fixed shaft position and can be used to mark a zero reference point.

Many different pulse configurations are available, but the most commonly known are the quadrature encoders, where two square wave pulses 90 degrees apart from each other are generated.