The Fourier transform is undoubtedly one of the most valuable and frequently used tools in signal processing and analysis but it has some limitations. In this paper, we rectify these limitations by proposing a newer version of Fourier transform, namely, Distributed Multiresolution Discrete Fourier Transform (D-MR-DFT) and its application in digital watermarking. The core idea of the proposed watermarking scheme is to decompose an image into four frequency sub-bands using D-MR-DFT and then singular values of every sub-band are modified with the singular values of the watermark. The experimental results show better visual imperceptibility and resiliency of the proposed scheme against intentional or unintentional variety of attacks. © 2010 World Scientific Publishing Company.