This paper describes a significantly improved recognition system for on-line handwritten Japanese text free from line direction and character orientation constraints. The recognition system separates handwritten text of arbitrary character orientation and line direction into text line elements, estimates and normalizes character orientation and line direction, applies two-stage over-segmentation, constructs a segmentation-recognition candidate lattice and evaluates the likelihood of candidate segmentation-recognition paths by combining the scores of character recognition, geometric features and linguistic context. Enhancements over previous systems are made in line segmentation, over-segmentation and context integration model. The results of experiments on text from the HANDS-Kondate_t_bf-2001-11 database demonstrate significant improvements in the character recognition rate compared with the previous systems. Its recognition rate on text of arbitrary character orientation and line direction is now comparable with that possible on horizontal text with normal character orientation. Moreover, its recognition speed and memory requirement do not limit the platforms or applications that employ the recognition system.