Co-polarized and cross-polarized holographic gratings were respectively recorded on the indolylfulgimide/PMMA film and their diffracted images were obtained. The experiment indicates that the indolylfulgimide possesses the characteristic of photo-induced anisotropy, therefore it can be used for cross-polarized holographic recording. In polarization holography, the polarization of diffraction beam is dependent on the polarizations of reference beam and object beam. The noise of the diffraction image mainly comes from the diffusion of the readout beam on the sample. Cross-polarized holography can obtain higher signal-to-noise ratio of reconstructed image than that of co-polarized holography. Holographic gratings recorded on the film can be kept for at least five months in darkness at room temperature without decrease of diffraction efficiency. The results show that indolylfulgimide is an erase-rewritable optical storage material that can be used in polarization holography.