Abstract: Based on the characteristics that the infrared polarization image can restrain background noise greatly, and can be more sensitive to target edge information, a polarization image fusion algorithm based on wavelet transform is proposed. It is mainly used in image fusion between the infrared radiation intensity image and the polarization degree image in order to increase the amount of information of the image. First, wavelet transform can make different wavelet scaling decomposition in each involved image respectively, and get the wavelet coefficients of each scale. Second, it uses the method of neighborhood average gradient on each scaling wavelet coefficients to get each scaling wavelet fusion coefficients. Last, it makes image reconstruction based on wavelet transform to get fused image. The comparison between the images and fused images shows that this method can keep image clarity of the radiation intensity image, as well as highlight the edge and contour information. Compared to the radiation intensity image, the average gradient of fused images increases by 112%, while compared to the polarization degree image, the standard deviation of fused images increases by 151% ,and the information entropy of fused images increases by 38%.