The demand for minimal cyclic nonlinearity error in laser interferometry is increasing as a result of advanced scientific research projects. Research shows that the quadrature phase error is the main effect that introduces cyclic nonlinearity error, and polarization-mixing cross talk during beam splitting is the main error source that causes the quadrature phase error. In this paper, a new homodyne quadrature laser interferometer configuration based on nonpolarization beam splitting and balanced interference between two circularly polarized laser beams is proposed. Theoretical modeling indicates that the polarization-mixing cross talk is elaborately avoided through nonpolarizing and Wollaston beam splitting, with a minimum number of quadrature phase error sources involved. Experimental results show that the cyclic nonlinearity error of the interferometer is up to 0.6 nm (peak-to-valley value) without any correction and can be further suppressed to 0.2 nm with a simple gain and offset correction method.