A heterodyne optical interferometer incorporates error correction elements to correct a cyclic error that may be present in an interferometric measurement. The cyclic error can be caused by various factors such as an imperfect polarization relationship between two wavelength components, deficiencies in optical propagation paths (such as light leakage), imperfect optical coatings, and/or imperfect components. The cyclic error, which typically manifests itself as erroneous displacement information characterized by a low velocity sinusoidal frequency component, can be reduced or eliminated by using birefringent optical elements and other optical elements to alter certain characteristics of one or both wavelength components and reduce light leakage components in one or more light propagation paths in the heterodyne optical interferometer.