Color-band resistor possessing specular surface is worthy of studying in the area of color image processing and color material recognition. The specular reflection and halo effects appearing in the acquired resistor image will result in the difficulty of color band extraction and recognition. A computer vision system is proposed to detect the resistor orientation, segment the resistor’s main body, extract and identify the color bands, as well as recognize the color code sequence and read the resistor value. The effectiveness of reducing the specular reflection and halo effects are confirmed by several cheap covers, e.g., paper bowl, cup, or box inside pasted with white paper combining with a ring-type LED controlled automatically by the detected resistor orientation. The calibration of the microscope used to acquire the resistor image is described and the proper environmental light intensity is suggested. Experiments are evaluated by 200 4-band and 200 5-band resistors comprising 12 colors used on color-band resistors and show the 90% above correct rate of reading resistor. The performances reported by the failed number of horizontal alignment, color band extraction, color identification, as well as color code sequence flip over checking confirm the feasibility of the presented approach.