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The problem of detecting underwater targets from electro-optical (EO) images is considered in this paper. A block-based log-likelihood ratio test has been developed for detection and segmentation of underwater mine-like objects in the EO images captured with a CCD-based image sensor. The main focus of this research is to develop a robust detection algorithm that can be used to detect low contrast and partial underwater objects from the EO imagery with low false alarm rate. The detection method involves identifying frames of interest (FOI) containing the potential targets. Once the FOI have been identified, regions of interest (ROI) within the FOI are segmented from the background. Performance of the detection method is tested in terms of probability of detection, false alarm rate, and receiver operating characteristic (ROC) curves for FOI in the selected data runs. The algorithm shows promising results in target detection and generation of good silhouettes for subsequent classification.