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In a strapdown inertial navigation system (INS), the general displacement of a rigid body is traditionally separately modeled and analyzed, i.e., direction cosine matrix or quaternion for rotation analysis and vector for translation analysis. As a subsequent work of a companion paper (Wu et al., 2005), this paper adopts dual quaternion algebra, a most concise and unified mathematical tool for representing the general displacement of a rigid body, to analyze error characteristics of the strapdown INS. Two new error models in terms of quaternion algebra are developed: the additive dual quaternion error (ADQE) model and multiplicative dual quaternion error (MDQE) model. Both are expected to facilitate the future inertial navigation-based integrated navigation filter.