Aiming at a phenomenon that the acquired RMB number is colorful and noised image, a method based on HIS space and improved clustering algorithm for RMB number color image segmentation is proposed. The HSI space is a colorful segmentation space, which is adopted. The 3-D searching problem is transformed into three 1-D searching problems in the HSI space. Three gray histograms on the 1-D direction is obtained. By the gray scale value of every pixel in current neighborhood 3×3 and the gray scale of the current pixel, the gray scale value p(m) of the current pixel ofcluster algorithm is determined, and improved C-means cluster method is used to distinguish the clustering center of character from non-character. The foreground and the background of RMB number image is clustering judged through using Euclidean distance. A colorful RMB number image is segmented and the segmentation method is adaptive. Experimental results show that the proposed segmentation method is not influenced by image noise and local edge change, and the amount of data is less than that of pre-transformation. This method is effective and robust for alphabet segmentation and number segmentation.