An improved image fusion method based on à trous wavelet decomposition is presented in this paper. The method was applied to panchromatic and multispectral images from Landsat 7 ETM+ in the Jiaozhou Bay. The multispectral images and panchromatic image were decomposed by à trous wavelet transform. The low frequency parts of multispectral images were modulated by texture properties of the panchromatic image. The wavelet coefficients were obtained by using the fusion rules based on the area-based energy ratio and maximum absolute value. At last, the fused image was reconstructed by inverse wavelet transform. Quantitative assessment of the results shows that the fused image obtained by the method has the merits of better preservation of image definition and less loss of spectral information. The fused image with high spatial and spectral information can increase the accuracy of classification.