This paper describes an abductive reasoning based inferencing engine for image interpretation. The inferencing strategy finds an acceptable and consistent explanation of the features detected in the image in terms of the objects known a priori. The inferencing scheme assumes representation of the domain knowledge about the objects in terms of local and/or relational features. The inferencing system can be applied for different types of image interpretation problems like 2-D and 3-D object recognition, aerial image interpretation, etc. In this paper, we illustrate functioning of the system with the help of a 2-D object recognition problem.