A simple technique which automatically detects and then segments nucleated cells in Wright's giemsa-stained blood smears is presented. Our method differs from others in 1) the simplicity of our algorithms; 2) inclusion of touching (as well as nontouching) cells; and 3) use of these algorithms to segment as well as to detect nucleated cells employing conventionally prepared smears. Our method involves: 1) acquisition of spectral images; 2) preprocessing the acquired images; 3) detection of single and touching cells in the scene; 4) segmentation of the cells into nuclear and cytoplasmic regions; and 5) postprocessing of the segmented regions. The first two steps of this algorithm are employed to obtain high-quality images, to remove random noise, and to correct aberration and shading effects. Spectral information of the image is used in step 3 to segment the nucleated cells from the rest of the scene. Using the initial cell masks, nucleated cells which are just touching are detected and separated. Simple features are then extracted and conditions applied such that single nucleated cells are finally selected. In step 4, the intensity variations of the cells are then used to segment the nucleus from the cytoplasm. The success rate in segmenting the nucleated cells is between 81 and 93%. The major errors in segmentation of the nucleus and the cytoplasm in the recognized nucleated cells are 3.5% and 2.2%, respectively.