The spindle rotational accuracy is one of the important issues in a machine tool which affects the surface topography and dimensional accuracy of a workpiece. This paper presents a machine-vision-based approach to radial error measurement of a lathe spindle using a CMOS camera and a PC-based image processing system. In the present work, a precisely machined cylindrical master is mounted on the spindle as a datum surface and variations of its position are captured using the camera for evaluating runout of the spindle. The Circular Hough Transform (CHT) is used to detect variations of the centre position of the master cylinder during spindle rotation at subpixel level from a sequence of images. Radial error values of the spindle are evaluated using the Fourier series analysis of the centre position of the master cylinder calculated with the least squares curve fitting technique. The experiments have been carried out on a lathe at different operating speeds and the spindle radial error estimation results are presented. The proposed method provides a simpler approach to on-machine estimation of the spindle radial error in machine tools.