A DAC has an N-bit R-string DAC section and an (M-N)-bit interpolation DAC section. The N-bit R-string DAC section has a plurality of resistors and a 2-of-N selector. The resistors are electrically connected in series to provide a plurality of voltage levels. The 2-of-N selector is coupled to the series-connected resistors, and is arranged to select two neighboring voltage levels according to an N-bit MSB subword. The (M-N)-bit interpolation DAC section is coupled to the N-bit R-string DAC section, and is arranged to interpolate an analog output signal from the two neighboring voltage levels according to an (M-N)-bit LSB subword.