An improved technique for multiple target detection using wavelet transform based joint transform correlation is proposed. In this technique, a bank of wavelet filters are generated using the Mexican hat wavelet function. These filters are then sequentially superimposed on the joint power spectrum before applying the inverse Fourier transform to yield the correlation output. This technique is found to yield high correlation discrimination for multiple target detection of gray level input scenes while avoiding the false alarms as well as rejecting the non-target objects. An all-optical implementation for the proposed wavelet JTC technique is also suggested. Computer simulation results confirm the effectiveness of the proposed technique.