Texture-segmentation is the crucial initial step for texture-based image retrieval. Texture is the main difficulty faced to a segmentation method. Many image segmentation algorithms either can't handle texture properly or can't obtain texture features directly during segmentation which can be used for retrieval purpose. This paper describes an automatic texture segmentation algorithm based on a set of features derived from wavelet domain, which are effective in texture description for retrieval purpose. Simulation results show that the proposed algorithm can efficiently capture the textured regions in arbitrary images, with the features of each region extracted as well. The features of each textured region can be directly used to index image database with applications as texture-based image retrieval.