Based on the dual-beam illumination principle of Leendertz, an electronic speckle pattern interferometer (ESPI) is developed to determine separately two orthogonal components of the in-plane displacement field. In the arrangement described, the lengths of the illumination beams were reduced to make the optical setup compact. The CCD camera for recording images is placed outside the area enclosed by the optical path, and adequate working space is provided between the camera and the test rig, so that adjustments can be made without interfering with the light beams. Using a customized telephoto lens, different areas in the range of 5.6x4.0 and 14x10 mm2 can be examined at a distance of 550 mm from the test piece. Combined with the blind-hole-drilling method, it is applied to residual stress determination, which is a challenging task due to stress concentration and severe decorrelation in the area neighboring the drilled hole.