Thermally induced errors have been significant factors affecting the machine tool accuracy. In this paper, the spindle thermal error has been focused, where the 5 degree of freedom thermal error components are considered. An effective measurement system has been devised for the 5 DOF thermal errors, consisting of gap sensors and thermocouples around the micro-computer interfaced environment. Several thermal error modeling techniques are also implemented for the thermal error prediction: multiple linear regression, neural network and system identification methods, etc. The performance of the thermal error modeling techniques is evaluated and compared, giving the system identification method as the optimum model having the least deviation. The developed system for the thermal error measurement and modeling was practically applied to a CNC machining center, and the spindle thermal errors were effectively compensated around the micro computer-machine tool interfaced networks. The machine tool accuracy was improved about 4-5 times typically.