This work proposes design, optimization and validation of a new two degree-of-freedom (DOF) rotational optical image stabilizer (OIS) that is suitable for installing into a mobile-phone-camera. This OIS differs from the previous designs since it stabilizes the lens holder directly by two-DOF translational mechanisms that are actuated by voice coil motors. The work can be divided into three main parts: (1) designs of mechanism and genetic algorithm (GA) optimization of magnetic field, (2) establishments of the dynamic model and equation of motions (EOM) of a dual-axis rotational structure, and (3) realizations of a sliding mode control (SMC) controller with fine performance. The dynamic of the dual-axis rotational OIS system has been analyzed and the EOM has been derived. Based on the Lagrange's method, the motions of the OIS have been modeled through considering kinetic energy and electromagnetic torques. In the last part, the theory of SMC is applied, and the associated simulations are conducted. Based on the simulation results, the SMC controller is forged with the assistances from MATLAB pre-simulation and tested by a microprocessor module. After a series of experiments and verifications, the prototype of the novel OIS is finally accomplished with satisfactory performance of vibration reduction.