In this paper, we propose a new adaptive image interpolation algorithm for enhancement of natural images. The proposed method uses different algorithms namely SAI, SPIA and Context-Based Image Interpolation Algorithm (CBIA) techniques, for both edgy and smooth type of images. The detailed part of smooth type image is interpolated by SAI, while we propose to use SPIA method for detailed part of edgy image. The rest of the pixels for either type of images are interpolated by CBIA. From the simulation results, we found that our adaptive interpolation technique results in better subjective and objective (PSNR) quality in comparision to some of the recent works in literature. © 2012 IEEE.