Watermarking is one of the methods that insist on a copyright as it append digital signals in digital informations.(image, video, ets) In this paper, we proposed a digital watermarking algorithm which improved Gradient of DCT Coefficient. This method targets MPEG-2 TM5 system and watermarking process is to be performed during Quantization DCT. Watermark was inserted on Y components of each frames. The PSNR difference between the compressed images with and without watermarking was only 0..23dB. In each case that the resulting image was reusable the normalized correlation between the extracted watermark and the original one was above 0.99.