Regarding outfield test and calculation of the pod laser indication precision, a sine algorithm computing the deviation angle of the laser indication based on the sighting axis coordinate system was advanced in this paper. The least-square fitting of orthogonal polynomial was adopted for this algorithm to capture the pod track as well as estimating the measurement precision of the pod coordinate. Further, an error model of the laser indication precision was established and an impact factor of the error source was also calculated according to the analysis of the test error source. It indicates that the error of the sine algorithm is three digit classes lower than the cosine algorithm under a small deviation angle, and it is the best way to reduce the testing error of the laser indication precision by improving the position measurement precision of the laser spot. In addition, this algorithm reduces obviously the calculating error of the pod laser by around 2-3 digit classes, and provides an evidence for the performance demonstration of the measuring system of the laser spot.