In this paper, a new robust watermarking scheme is proposed using fractional Fourier transform (FrFT) and singular value decomposition. The core idea of the proposed scheme is to decompose an image using FrFT followed by the non-overlapping block segmentation. A new key matrix is then formed by taking maximum singular values of all non-overlapping blocks. For embedding this key matrix is used and is done by modifying singular values with the singular values of the watermark. The experimental results show better visual imperceptibility and resiliency of the proposed scheme against intentional or un-intentional variety of attacks. © 2010 Springer-Verlag Berlin Heidelberg.