With the rapid development of network communication and broad application of multimedia technology, copyright protection of digital media work is becoming more and more important. Digital watermarking is viewed as an effective tool for copyright protection of multimedia data. At first the princip1e, research background and status of digital watermark is described. Then, a blind watermarking algorithm based on DWT is proposed. The watermark image is scrambled by a generalized Arnold transform so as to improve the security of the watermark; the watermark is embedded into the middle-frequency subband which guarantees the robustness of the algorithm; In order to implement the blind extraction, this paper improves an embedding algorithm based on HVS, which enhances the applicability of the algorithm. This paper tests the algorithm by VC++6.0, and quantity of experiment data shows that algorithm has good robustness, and the imperceptibility of watermark can be guaranteed at the same time.