An object is to provide an internal gear grinding machine and a dressing method for a barrel-shaped threaded tool which make it possible to achieve space savings and reduce the size of a machine by simplifying dressing operation. To achieve the object, an internal gear grinding machine for use in grinding a workpiece (W) by synchronously rotating the workpiece (W) and a barrel-shaped threaded grinding wheel (17) in mesh with each other includes a dressing device (20) for dressing the threaded tool (17) by meshing the threaded grinding wheel (17) with a disk dresser (56). At the time of dressing, the threaded grinding wheel (17) and the disc dresser (56) are operated in accordance with the helix angle and the barrel shape of the threaded grinding wheel (17).