The work aims to study a halftone image with better visual effect to solve such problems as fuzzy image boundary and visual worm generated in the existing halftone algorithm. A digital halftone method for dynamic distribution of error diffusion coefficients in the halftone process was proposed to reduce such phenomena as fuzzy boundary, visual worm and structural texture brought by fixed error diffusion coefficients and fixed diffusion direction. Compared to the traditional error diffusion algorithm, PSNR value of the proposed method was improved by about 0.5, SSIM value improved by about 0.06 and NSME value reduced by about 0.06. In such case, not only the fuzzy boundary in the traditional error diffusion algorithm was solved, but also the information on detailed texture of halftone image was better expressed. The visual effect of the halftone image generated based on the proposed algorithm is good, and the algorithm is simple and easy and of high running efficiency.