Precision measurement is the basis of precision machining and it's one of the decisive factors of manufacturing accuracy in the manufacturing industry. It is widely used in the field of contemporary precision machinery manufacturing. The grating-based precise displacement measurement system play an important role in the field of precise displacement measurement because of its small environmental requirements and high resolution. The grating-based precise displacement measurement system includes optical measurement, signal reception, electronic subdivision and integral adjustment. In this paper, the optical path of optical measurement is introduced. Firstly, the principles of classical grating interferometric displacement measurement are introduced. Secondly, the key technologies of the grating-based precise displacement measurement system are summarized. Thirdly, the latest representative measurement techniques are compared and analyzed, and their advantages and disadvantages are summarized. Finally, prospects are provided for the future of grating-based precise displacement measurement technology wherein the the development trend of its high precision, high resolution, high robustness, miniaturization, multi-dimension and multi-technological fusion are revealed.