Illegally parked vehicle detection systems are considered crucial elements in the development of any video-surveillance based traffic-management system. The major challenges in this task lie in making the end solution real time, illumination invariant and occlusion tolerant. A two-stage application framework is presented which efficiently identifies vehicles parked illegally in restricted parking- zones. A real-time approach has been followed and an improved foreground segmentation method based on Segmentation History Images (SHI) is developed to identify stationary objects. A three step pixel based classification method is applied on the background segmentation output to segment adjacent moving pixels that become stationary for certain periods of time. The process then locks on to all identified stationary pixel patches, parts of which overlap with the regions of interest marked interactively a priori. The second stage of the process is applied subsequently to track all the stationary pixel patches detected during the first stage using an adaptive edge orientation based tracking method. Experimental results show that the tracking technique gives more than a 90% detection success rate, even if objects are partially occluded. The technique has been tested on the UK Home Office i-LIDS Parked Vehicle video sequences along with the University of Sussex Traffic Dataset and results are compared with other available state of the art methods.