Abstract: In this article a texture feature extraction scheme based on M-band wavelet packet frames is investigated. The features so extracted are used for segmentation of satellite images which usually have complex and overlapping boundaries. The underlying principle is based on the fact that different image regions exhibit different textures. Since most significant information of a texture often lies in the intermediate frequency bands, the present work employs an over-complete wavelet decomposition scheme called discrete M-band wavelet packet frame (DM-bWPF), which yields improved segmentation accuracies. Wavelet packets represent a generalization of the method of multiresolution decomposition and comprise of all possible combinations of subband tree decomposition. We propose a computationally efficient search procedure to find the optimal basis based on some maximum criterion of textural measures derived from the statistical parameters of each of the subbands, to locate dominant information in each subbands (frequency channels) and decide further decomposition.