In this paper, we propose an efficient watermarking algorithm using block indexing. The proposed algorithm is a novel blind watermarking scheme using the indexed watermark value based on the spread spectrum method. The watermark insertion is allocated into index value of each block after dividing original image into sub-blocks. The watermark embedded in mappinged with index values of blocks, And the mappinged blocks convert to DCT and then the PN sequence embedded to middle frequency band. Consequently the watermark is expressed by index value of sub-blocks. The watermark extracted from the correlation of between PN sequence and watermarked image. Experimental results demonstrate that the watermarked image has a good quality in terms of imperceptibility and is robust against various attacks.