Digital image processing is a fast growing field and many applications are developed in science and engineering. Image processing has the possibility of establish the latest machine that could perform the visual functions of all living beings. Object recognition is one of the most imperative features of image processing. Coin detection is the most interesting and challenging research topic from past few years. It is known that the size of a coin is changing day by day. 1 rupee coin is small in size and also in big size that’s create a problem in coin detection. So we need a approach which is able to detect a particular coin. In this paper we will discuss on coin detection technique. An automated system is developed using morphological recognition algorithm in MATLAB R2013a. In which image is captured from camera and converted into gray scale image for pre-processing. After conversion, image complemented, binary conversion is applied on image. After conversion canny edge detection method has done and passed this detection to the dilation process. After filtration and dilation, area is selected where number of coins is maximum and coins are recognized from the image in the form of bounding box. Blob analysis is used for each coin separately to detect indian coins