Your desktop background is a reflection of your personality and a place to rest in between hectic work sessions. However, it's hard to enjoy a scenic sunset, abstract pattern or quiet beach if the image turns out blurry and distorted when you apply it to your desktop. Blurry desktop backgrounds can have myriad causes; troubleshooting requires a bit of trial and error but is fairly straightforward.
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Set your desktop background to "Center" instead of "Stretch." Right-click the desktop, select "Personalize" and then click "Desktop Background." Select "Center" from the "Picture Position" drop-down. If your image is too small to fill your desktop and it is set to "Fill," Windows will stretch the image, causing blur.
Download a new version of the image that shares the same resolution as your monitor. Right-click the desktop and then select "Screen Resolution." Make a note of your monitor's current resolution and locate a different copy of the image that matches. Alternatively, use a program like Adobe Photoshop, Paint.net, or GIMP to crop the image into the correct screen size. For best results, ensure your resolution is set to "Native."
Update your graphics card drivers. The graphics card on your computer controls all visual output and could cause strange issues such as a blurry background. Driver downloads are usually available in the "Downloads" section of the graphics card manufacturer's website.
Check the original image for blur. If the image you're attempting to use is blurry when displayed at any size, the problem is with the source file and not your computer's display. Re-create the image if possible or look for a new background with less blur.