The recent proliferation of digital multimedia content has raised concerns about authentication mechanisms for multimedia data. A number of authentication techniques based on digital watermarks have been proposed in the literature. In this paper we examine the security of the Yeung–Mintzer authentication watermarking technique and show that it is vulnerable to different types of impersonation and substitution attacks whereby an attacker is able to either create or modify images that would be considered authentic. We present two attacks. The first attack infers the secret watermark insertion function. This enables an attacker to embed a valid watermark in any image. The attack works without knowledge of the binary watermark inserted in the image, provided the attacker has access to a few images that have been watermarked with the same secret key (insertion function) and contain the same watermark. We show simulation results in which the watermark and the watermark insertion function can be mostly reconstructed in a few (1–5) minutes of computation, using as few as two images. The second attack we present, which we call the ‘‘collage attack’’ is a variation of the Holliman–Memon counterfeiting attack. The proposed variation does not require knowledge of the watermark logo and produces counterfeits of superior quality by means of a sophisticated dithering process.