Awesome

RotaryEncoder library

A library for the Arduino environment for using a rotary encoder as an input.

Here you can find an Arduino compatible library for using rotary encoders.

When I was searching a library for using a rotary encoder in my latest project and found a lot of information on this topic but none of the existing libraries did immediately match my expectations so I finally built my own.

It supports the type of rotary encoder that has a phase change on both input signals when rotating one notch.

The article on my web site explains the software mechanisms used in detail so you can understand the coding and might be able to adjust it to your needs if you like:

http://www.mathertel.de/Arduino/RotaryEncoderLibrary.aspx

There are various aspects when writing a library for rotary encoders and you can also find a lot of the sources I analyzed at the bottom of the article.