An image encryption method based on fractional Fourier transform (FRFT) and odd-even quantification is proposed in this paper. First of all, Arnold transform is used to scramble a binary watermark image P to obtain W. The carrier image I is divided into 8×8 overlapping blocks, and then a FRFT with an order of (a,b) is performed on each block. After that, odd-even quantification is carried out on the transform coefficients of each block. Then one-bit watermark information is embedded into each block. Finally, the FRFT with an order of (-a,-b) is performed on each block embedded with the watermark information, obtaining the watermarked image. Simulation and various attack tests are carried out. The results show that the algorithm has very good robustness against image cut, salt and pepper noise, brightness adjustment, contrast adjustment, etc. The keys also have more degrees of freedom and better sensitivity, improving the image encryption performance.