Small tracking error correction for electro-optical systems is essential to improve the tracking precision of future mechanical and defense technology. Aerial threats, such as “low, slow, and small (LSS)” moving targets, pose increasing challenges to society. The core goal of this work is to address the issues, such as small tracking error correction and aiming control, of electro-optical detection systems by using mechatronics drive modeling, composite velocity–image stability control, and improved interpolation filter design. A tracking controller delay prediction method for moving targets is proposed based on the Euler transformation model of a two-axis, two-gimbal cantilever beam coaxial configuration. Small tracking error formation is analyzed in detail to reveal the scientific mechanism of composite control between the tracking controller’s feedback and the motor’s velocity–stability loop. An improved segmental interpolation filtering algorithm is established by combining line of sight (LOS) position correction and multivariable typical tracking fault diagnosis. Then, a platform with 2 degrees of freedom is used to test the system. An LSS moving target shooting object with a tracking distance of S = 100 m, target board area of A = 1 m², and target linear velocity of v = 5 m/s is simulated. Results show that the optimal method’s distribution probability of the tracking error in a circle with a radius of 1 mrad is 66.7%, and that of the traditional method is 41.6%. Compared with the LOS shooting accuracy of the traditional method, the LOS shooting accuracy of the optimized method is improved by 37.6%.