ABSTRACT Data hiding is also known as data encapsulation or information hiding, it reduces system complexity for increased robustness. Proposed approach provides optimal solution for performing data hiding. Here secret data is to be generated based on the various chaotic mapping approaches. Then the generated chaotic sequences are embedded into cover image by Particle Swarm Optimization method. In PSO, Optimal solution is achieved which is calculated based on the maximal PSNR. Finally the stego image has been generated with minimal changes of the cover image.