Auxetic materials with negative Poisson’s ratio have excellent physical and mechanical properties, such as shear resistance, fracture resistance and energy absorption. To expand the application of the helical auxetic yarn, a novel three-component helical auxetic yarn was developed by utilizing modified ring spinning technology. The three-component helical auxetic yarn incorporated staple fiber components into the traditional two-component helical auxetic yarn, using cotton (staple wrap fiber)/polyester (stiffer wrap filaments)/spandex (elastomeric core filaments) as the raw material for spinning. Compared with two-component helical auxetic yarn, the addition of cotton components did not significantly impact Poisson’s ratio, and the three-component helical auxetic yarn maintained a relatively stable negative Poisson’s ratio under prolonged strain. The spinning parameters of helical auxetic yarns have an impact on the yarn’s structure, which subsequently impacts the yarn’s negative Poisson’s ratio. It was found that there were significant differences in Poisson’s ratio of helical auxetic yarn between different twist factors and draft ratio of the filaments. The test results revealed that, the maximum negative Poisson’s ratio of the three-component helical auxetic yarn could reach −4.66 under a twist factor [Formula: see text] of 3.40, an elastomeric core filament draft ratio of 1.02 and a stiffer wrap filament draft ratio of 1.03.