On the basis of the measuring principle of time grating sensors, a new variable coupling time grating displacement sensor was proposed by employing a high-frequency pulse as measurement basis to improve the precision of displacement measurement. The precision displacement measurement of the sensor was implemented by changing the coupling state of excitation and induction coils to output a traveling wave signal for inducing the displacement change. By modeling and simulations, the displacement error characteristics of the sensor when sensor-head was in different attitudes were obtained. The harmonics analysis was performed, and the influence of different sensor-head attitudes on different resonances of the displacement measurement errors was obtained. A sensor prototype was designed based on the model and then experiments were carried out. Simulations and actual experiments indicate that different sensor-head attitudes mainly influence 1st, 2nd and 4th harmonics, and other harmonics are more sensitive to pitch attitudes than other attitudes of the sensor-head. When the sensor-head is in a good attitude and the gap between ruler and sensor-head is 0.3 mm, both experimental analysis and simulation result show that the measurement error is about ±18 μm. Simulations and actual verification experiments are in agreement well.