This paper deals with an application for achieving precision curve grinding by automatic dressing and compensation of diamond wheel wear through non-contact measuring method. A realtime vision measurement combined with vibration analysis method for the wear of a grinding wheel is presented. The wear condition is evaluated by analyzing the topography changes of the wheel surface and the vibration signals in the grinding process. A kind of PC-based integrated control system with dynamic monitoring and automatic dressing function is investigated, and the control algorithm is also proposed. The benefits of the proposed methods are confirmed by the grinding experiments. Dynamic monitoring of the wheel facilitates determining the optimum dressing amount and interval. A much higher abrasive machining precision and efficiency are attained by the real-time error measurement and compensation arrangement.