An improved image fusion algorithm based on wavelet transform is presented. The image is decomposed into high-frequency image and low-frequency image.The maximum absolute value within the window of high-frequency image is used as an activity measure associated with the center pixel to get the fused high-frequency image. The quality of the blocks within the low-frequency image is measured to determine the fused low-frequency image. The experimental result shows that clarity and contrast of the fused image are improved. The proposed algorithm is verified effective for image fusion.