Dimensional accuracy is one of the most important quality indicators of large shaft grinding, which directly affects the shaft service performance. Overcut/undercut caused by grinding wheel width and wear are the main factors affecting dimensional accuracy of large shaft grinding, which can be described by establishing physical models, and the physical models would be further used for compensation. However, the residual error always exists due to modeling uncertainty, and the residual error has nonlinear relation with compensation value, which is hard to completely eliminate. In order to solve the problem, this paper proposes a dimensional accuracy compensation method of large shaft grinding via residual error iteration with fuzzy approach. Two physical models are firstly established by considering the grinding wheel width and wear, respectively. The residual error after using these two models is further dealt with iteration, and the fuzzy approach is applied to dynamically calculate the compensation coefficients to improve dimensional accuracy while ensuring con-vergence. The experimental results show that the mean dimensional error is reduced 83% by using the pro-posed method, which is much better than other compensation methods.