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Exudates are one of the earliest and most prevalent symptoms of diseases leading to blindness such as diabetic retinopathy and wet macular degeneration. Certain areas of the retina with such conditions are to be photocoagulated by laser to stop the disease progress and prevent blindness. Outlining these areas is dependent on outlining the exudates, the blood vessels, the optic disc and the macula and the region between them. The earlier the detection of exudates in fundus images, the stronger the kept sight level. So, early detection of exudates in fundus images is of great importance for early diagnosis and proper treatment. In this paper, we provide a feature-based method for early detection of exudates. The method is based on segmenting all objects that have contrast with the background including the exudates. The exudates could then be extracted after eliminating the other objects from the image. We proposed a new method for extracting the blood vessel tree based on simple morphological operations. The circular structure of the optic disc is obtained using Hough transform. The regions representing the blood vessel tree and the optic disc are set to zero in the segmented image to get an initial estimate of exudates. The final estimation of exudates are obtained by morphological reconstruction. This method is shown to be promising as we can detect the very small areas of exudates.