To improve information hiding algorithm, an improved algorithm realizing digital image watermark embedding in the transform domain is presented. On the basis of deeply understanding that the coefficient of a digital image after Discrete wavelet transform has correlation, it carries out discrete cosine transform of the transformed digital image coefficient and then embeds digital watermarks, which makes the algorithm have the characteristics of the two transforms.Experiments showed that this algorithm not only ensures the invisibility of watermark but also has good robustness.