This paper presents a new robust reference watermarking scheme based on wavelet packet transform (WPT) and bidiagonal singular value decomposition (bSVD) for copyright protection and authenticity. A small gray scale logo is used as watermark instead of randomly generated Gaussian noise type watermark. A reference watermark is generated by original watermark and the process of embedding is done in wavelet packet domain by modifying the bidiagonal singular values. For the robustness and imperceptibly, watermark is embedded in the selected sub-bands, which are selected by taking into account the variance of the sub-bands, which serves as a measure of the watermark magnitude that could be imperceptibly embedded in each block. For this purpose, the variance is calculated in a small moving square window of size Sp × Sp (typically 3 × 3 or 5 × 5 window) centered at the pixel. A reliable watermark extraction is developed, in which the watermark bidiagonal singular values are extracted by considering the distortion caused by the attacks in neighboring bidiagonal singular values. Experimental evaluation demonstrates that the proposed scheme is able to withstand a variety of attacks and the superiority of the proposed method is carried out by the comparison which is made by us with the existing methods. © 2009 World Scientific Publishing Company.