A form grinding machine of spur gears, equipped with the dressing attachment drived by means of NC controllers, which is described as "form dressing an involute profile based on a circular arc movement" in the 2nd report written by authors, is developed. Here, an economical D. D. A. type NC controller, depending on a method of automatic interconnection among operational elements, is used. It enables, what you call "the on-line form grinding machine of gears", correcting the part of a punched tape, which allows easy and rapid grinding gears in obedience to their data: module, tooth number and pressure angle, further tooth profile modification. For example, standard and modified profiles, of which data is module; 2, number of tooth; 48, and pressure angle; 20 degrees, are ground by this machine, and results of profile and tooth trace inspection show the deviation from the ideal and the experimental are separately within 2 μm. Further, an automatic indexing machine using a rotary magnetic scale, which set a position demand counter to the total number corresponding to the angle required, then the dividing angle is a multiple of 10 minutes, is designed. The indexing accuracy of 17 seconds of arc, is demonstrated and its repeatability is high. Using the grind wheel of a finer grain size, the accumulated pitch error due to the abrasive wear appears with distinct increase. Then, the wear quantity being detected by means of air micrometer, the result of compensating the pitch error shows that it decreases from 51 seconds to 24 seconds.