A novel interference-based multiple-image encryption method with high encryption capacity was proposed by position and wavelength multiplexing. For encryption, the original images to be encrypted were divided into two groups, and each group of target images was analytically hidden into two phase only masks by position multiplexing. Subsequently the obtained four phase only masks were further merged into two diffractive phase elements by wavelength multiplexing. The encryption process did not need iterative algorithm and should be implemented digitally, while the decryption process could be performed both digitally and optically. The encryption capacity of the system was evaluated with correlation coefficient, and it was shown that the capacity was greatly improved due to the introduction of both position and wavelength multiplexing. In addition, the robustness of the proposal against noise and occlusion was also investigated, and the results indicated that the proposal is of high robust against noise attack but a little vulnerable to occlusion attack.