Inspired by the edge blurred in output of error diffusion algorithm, the fundamental of error diffusion algorithm was analyzed; it was considered that the reason of edge blurred is that diffused error changes the edge pixels' value tendency. A new texture sensitive diffusion filter was designed according to the consideration. The quality of the new filter's output is bad on smooth areas, so a filter selection algorithm was designed bases on local Fourier analysis. The new filter and conventional ED filter was applied in texture areas and smooth areas respectively. The output test pattern was evaluated. Subjective evaluation showed that the new algorithm significantly improve the quality of halftone output.