Steganography, water marking and encryption are widely used in image processing and communication. A general practice is to use them independently or in combination of two - for e.g. data hiding with encryption or steganography alone. This paper aims to combine the features of watermarking, image encryption as well as image steganography to provide reliable and secure data transmission .The basics of data hiding and encryption are explained. The first step involves inserting the required watermark on the image at the optimum bit plane. The second step is to use an RSA hash to actually encrypt the image. The final step involves obtaining a cover image and hiding the encrypted image within this cover image. A set of metrics will be used for evaluation of the effectiveness of the digital water marking. The list includes Mean Squared Error, Peak Signal to Noise Ratio and Feature Similarity.
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