An **incremental encoder** is a type of rotary or linear position sensor that generates a series of electrical pulses as the shaft or linear element moves. These pulses correspond to incremental movements, allowing the system to measure changes in position, speed, and direction.

Unlike absolute encoders, which provide a unique position value at all times, incremental encoders only give information about movement relative to a starting point. This makes them simpler and often more cost-effective, but they require a reference point (home position) to determine the absolute position.