One of the central problems in sereo matching is the selectionof the optimal window sizes for comparing image regions. The window size must be large enough to include enough variation for reliable matching, but small enough to avoid the effect of projection distortion. This paper discusses these problems with some novel algorithm based on iterativediffusion process at different disparity hypotheses. Also this paper proposes four kinds of diffusion algorithms to preseve discontinuity in stereo matching. We present and discuss extensive empirical results of algorithms based on various sets of synthetic and real image.