Enhancing the visibility of infrared images obtained in a degraded visibility environment is very important for many applications such as surveillance, visual navigation in bad weather, and helicopter landing in brownout conditions. In this paper, we present an IR image visibility enhancement system based on adaptively modifying the wavelet coefficients of the images. In our proposed system, input images are first filtered by a histogram-based dynamic range filter in order to remove sensor noise and convert the input images into 8-bit dynamic range for efficient processing and display. By utilizing a wavelet transformation, we modify the image intensity distribution and enhance image edges simultaneously. In the wavelet domain, low frequency wavelet coefficients contain original image intensity distribution while high frequency wavelet coefficients contain edge information for the original images. To modify the image intensity distribution, an adaptive histogram equalization technique is applied to the low frequency wavelet coefficients while to enhance image edges, an adaptive edge enhancement technique is applied to the high frequency wavelet coefficients. An inverse wavelet transformation is applied to the modified wavelet coefficients to obtain intensity images with enhanced visibility. Finally, a Gaussian filter is used to remove blocking artifacts introduced by the adaptive techniques. Since wavelet transformation uses down-sampling to obtain low frequency wavelet coefficients, histogram equalization of low-frequency coefficients is computationally more efficient than histogram equalization of the original images. We tested the proposed system with degraded IR images obtained from a helicopter landing in brownout conditions. Our experimental results show that the proposed system is effective for enhancing the visibility of degraded IR images.