In this paper, we have assigned a unique range for both, a number of characters and groups using the characters. Long textual message which have to encrypt, is subdivided into a number of groups with n characters. Then the group of characters is encrypted into two floating point numbers by using arithmetic coding, where they are automatically compressed. Depending on key, the data bits from text are placed to some suitable nonlinear pixel and bit positions about the image. In the proposed technique, the key characters are alphanumeric and key length is also variable. Using the symmetric key technique again they are decrypted into original text message from the watermarked image.