Analog technology has been around for a long time. The use of analog technology is necessary since we live in an analog world. However, the transmission and storage of analog technology is more complicated and in many cases less efficient than digital technology. Digital technology, on the other hand, provides fast means to be transmitted and stored. Digital technology continues to grow and it is more widely used than ever before. However, with the advent of new technology that can reproduce digital documents or images with unprecedented accuracy, it poses a risk to the intellectual rights of many artists and also on personal security. One way to protect intellectual rights of digital works is by embedding watermarks in them. The watermarks can be visible or invisible depending on the application and the final objective of the intellectual work. This thesis deals with watermarking images in the discrete wavelet transform domain. The watermarking process was done using the JPEG2000 compression standard as a platform. The hardware implementation was achieved using the ALTERA DSP Builder and SIMULINK software to program the DE2 ALTERA FPGA board. The JPEG2000 color transform and the wavelet transformation blocks were implemented using the hardware-in-the-loop (HIL) configuration
