Abstract: The removal of unwanted vibrations in a video sequence induced by camera motion is an essential part of video acquisition in industrial, military and consumer applications. In this paper, we present a new image processing method to remove such vibrations and reconstruct a video sequence void of sudden camera movements. This approach to separating unwanted vibrations from intentional camera motion is based on a block matching motion estimation framework. The estimated parameters of interframe camera motion are the noisy observations of the intentional camera motion parameters. Video stabilization algorithm consists of a motion estimation (ME) block and a motion correction (MC) block. ME estimates the motion between frames and can be divided as a local motion estimator and a global motion decision unit. Basically the local motion estimator will return the estimated dense optical flow information between successive frames using typical block-based methods. The global motion decision unit will then determine an appropriate global transformation that best characterizes the motion described by the given optical flow information. Finally MC warps the current frame using the filtered global transformation information and generates the stabilized video sequence.