This paper describes a novel method to measure straightness error of an axis of motion with a system utilising taut wire, optical sensor and reference error cancellation technique. In contrast to commonly used taut wire, straightedge or laser-based methods it combines simplicity of setup and low cost with high levels of automation, accuracy and repeatability. An error cancellation technique based on two-point method is applied for the first time to a versatile reference object which can be mounted at any place of machine's working volume allowing direct measurement of motion straightness of a tool point. Experimental results on a typical machine tool validate performance of the proposed taut wire system with a commercial laser interferometer operating in the same conditions is used as a reference. The proposed method shows highly repeatable results of better than ±0.25 μm over the range of 0.48 m and measurement accuracy comparable to the interferometer of ±0.5 μm.