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In this paper, a segment extraction algorithm based on polygonal approximation for on-line Chinese characters recognition (OLCCR) is presented. With this method, the point with the smallest interior angle is detected and the whole stroke is split into two adjacent curves by this point-which is called as a cut-off point or an inflexion. To each of the two curves, the same step is performed to detect the cut-off points respectively. The same operations are performed iteratively until the smallest interior angle in all the curves is larger than an appointed threshold value. All the cut-off points and the start-end points compose the stroke and every pair of adjacent points constructs a segment. After segments have been extracted, finite state machines is used to check whether the adjacent segments need combination thus redundant segments can be reduced. Experiments proved that this method has the advantages of less computing complexity and better approximating effect than other methods. An OLCCR system with this segment extraction and combination algorithm has achieved the speed of 20/s and the recognition rate of 97.2%.