Abstract: Fancy yarn′s irregular shape, complicated structure of texture, and abundant changes in colors make it difficult to realize the outlining of its figure. In this paper, an algorithm based on Poisson′s equation is used to realize the edge outlining of fancy yarns. The bitmap of a fancy yarn is divided into three areas: the assured foreground, the assured background and the unsure area. The finite difference method and the Gauss-Seidel iteration method are applied to calculate the value of α the pixels in the unsure area, according to each pixel′s value of α to judge whether the pixel belongs to the foreground or the background. By repeated calculations, the unsure area reduces gradually and the exact outline of the fancy yarn can be obtained. Finally, the slubby yarn and the knot yarn are given for example, good outlining effects are obtained.