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The goal of image segmentation is to partition the image into several homogenous regions or particular objects with similar properties, such like color and texture. It is essential for object recognition and image retrieval, and it also could enhance the performance of certain compression algorithms. In this paper, a perceptual color contrast based watershed algorithm for color images segmentation is presented. The conventional watershed segmentation algorithm is not suitable for color image directly, since it is hard to decide a suitable color gradient measurement for color image. The proposed algorithm adopts HSV color space to define the color contrast gradient for the improvement of watershed algorithm. Experimental result shows that the proposed algorithm can avoid the over segmentation problem, and produce segmented result which is close to human perception.