In this thesis, we propose a key-based video watermarking system in which the watermark embedding and the video encoding are processed at the same time on MPEG-2. Since the watermark information would propagate to P/B frames through the motion compensated coding, the watermark is embedded in a single I frame but can be extracted from all frames in the same group of pictures (GOP).

The watermark is embedded in the low frequency DCT coefficients based on the block polarity. The block polarity is Tri-state XOR with the watermark to generate the secret key, which labels the block locations of the embedded watermark. In the decoding end, the key is Tri-state XOR with the block polarity to get the extracted watermark from all kinds of frames. Finally, the watermark over a GOP can be calculated by a weighted voting procedure according to the frame types and the displacements of the pixels.

The simulation results show that the system has great imperceptibility that the PSNRs of the watermarked frames are almost the same as the un-watermarked and more accurate normalized correlation (NC) can be obtained as well.