Video sequences are often distorted by noise and are usually found in
interlaced format throughout the TV video chain. Joint noise reduction and deinterlacing of such image sequences in interlaced format is a challenging task, required by various applications such as video surveillance or video quality improvement for TFT TV-sets, projectors, plasma panels and LCD screens which display video in progressive format. In this paper, we propose a novel, wavelet-domain joint deinterlacer and denoiser. We apply the wavelet decomposition to each field of the interlaced sequence and perform spatio-temporal interpolation and denoising in the wavelet domain in a motion-compensated manner. Hence, the processed wavelet bands are not only denoised but also have twice as more horizontal lines. We split these full resolution processed bands into odd and even lines, on which we separately perform two inverse wavelet transforms. Each of these inverse transforms uses the same filter bank that is the dual of the decomposition filter bank. As a final step the odd and even lines being the outputs of the two inverse wavelet transforms are merged in order to produce the denoised sequence in progressive format. The results of the proposed algorithm show good performance of the proposed joint deinterlacing and denoising scheme, for various noise levels tested. Specifically, the noise is efficiently removed and the spatio-temporal interpolation is performed in a superior manner without introducing significant visible artifacts.