Automatic Number Plate Recognition System ANPR is an essential stage for the automation of traffic system. Use of vehicles is getting increased in today’s era that is why traffic control is being tough. It is hard to store and maintain the record of vehicles manually. Automatic Number Plate Recognition System can be used for better control of vehicles and for store and maintain the record of vehicles automatically. Automatic Number Plate Recognition System is the identification system of vehicles. It is an image processing technology used to identify the vehicles only by their license plates. Automatic Number Plate Recognition ANPR plays am major role in management of parking areas, and surveillance of illegally parked vehicles. Since every vehicle has a unique number plate so it can be identified by its number plate. The classification is utilized for the electronic toll-collection system (ETC) and to display available parking spaces to vehicles. The identification is also employed for managing parking facilities, monitoring and analysis of traveling time, and security systems such as observation of stolen vehicles and monitoring of unauthorized vehicles entering private areas Number plate recognition is realized by acquiring images of either the front or the rear of vehicles with cameras and then by image processing to identify license plates. It consist of three main stages. First one is Number Plate Identification & Localization in this segment the visual of the scene is improved with is image processing. Second is Character Segmentation in which characters segmented from the detected number plate for retaining the useful information to the system so that further processing can take place. Third is OCR Optical Character Recognition in which textis transferred into encoded text information.