We present a new oblivious digital watermarking method for copyright protection of still images. The technique is based on decorrelating the image samples then embedding the watermark by taking block DCT of the decorrelated image. Watermark insertion is obtained by amplitude modulating the DC component of the DCT blocks with the watermarking bits. The technique shows satisfactory robustness to Stirmark benchmark test and other class of geometric deformations. Image decorelation is achieved using a key to increase the security of the watermarking system. The watermark is a readable sequence of binary digits channel encoded to increase its robustness against various types of attacks.