Fourier transform spectrometer (FTS) modulated by means of rotary grating is developed in this paper. The grating simultaneously acts as a beam splitter and a heterodyne modulator. Three shemes to separate the light beams are analyzed. Three lasers with the wavelength of 670 nm, 633 nm and 532 nm respectively have been adopted to implement the measurement of spectrum. Experimental results show that this FTS takes advantage of favorable stability and strong ability of anti disturbance. The sensitivity of meausurement has been improved by 20 times with the modulation method. It is expected to be effective particularty in the domain of weak signal measurement and near infrared region.