A　fusion　algorithm　is　proposed　for　the　restoration　and　enhancement　of　underwater　images.　Color　balance,　contrast　optimization　and　histogram　stretching　are　carried　out.　To　alleviate　the　effect　of　color　shift　in　an　underwater　image,　the　scalar　values　of　R,　G,　B　channels　are　renewed　so　that　the　distributions　of　the　three　channels　in　histogram　are　similar.　Instead　of　refining　the　transmittance　in　dark　channel　prior　based　restoration,　an　optimized　contrast　algorithm　is　employed　by　which　the　optimal　transmittance　is　determined.　To　further　improve　the　brightness　and　contrast　of　underwater　images,　a　histogram　stretching　algorithm　based　on　the　red　channel　is　given.　To　verify　the　effectiveness　of　the　proposed　fusion　algorithm,　experimental　underwater　images　are　treated.　Results　show　that　the　quality　of　underwater　images　is　improved　significantly,　both　in　term　of　subjective　visual　effect　and　objective　evaluation.　The　proposed　underwater　image　processing　strategy　is　also　compared　with　some　popular　techniques.　Comparison　results　indicate　the　advantage　of　the　proposed　strategy　over　others.　©　2013　IEEE.