A new method is represented based on wavelet transform for image fusion and pseudo-coloring in multi-spectral photography with θ-modulation.Its features are as follows:The decoded image in visible band and infrared image′s low frequency components are fused with improved Weighted Average Method, and the fusion image′s high frequency components are obtained using local energy difference of two images as the fusion criterion.The fused images are synthesized into a pseudo-color in RGB color space.The theoretical analysis and experiment results show that with this method,good fusion performance and pseudo-color result can be achieved.