Abstract: An image watermarking algorithm in DWT domain is proposed which is robust against geometric distortion. We hide 536 information bits in a 512×512×8 image. The merits of the proposed algorithm are as follows: 1) By introducing distance between the attacked image and the original image, we can resynchronize the data extraction based on the minimum distances 2) Using multi-resolution matching and coarse-fine searching to prune the searching space, the computation of our algorithm is drastically reduced; 3) With BCH coding and 2-D interleaving technology the algorithm can correct some random errors and bursting errors in detection. The watermark thus generated is invisible and performs well in StirMark test. Compared with other watermarking algorithms reported in the literature, the algorithm is more robust, especially against geometric distortion, while having much higher bit rate.