In this paper we give an efficient method for obtaining interpolated images with much better PSNR compared to Bicubic interpolation scheme using a new technique called targeted image enhancement (TIE) to improve PSNR. <p> </p>Study of typical images decimated by a factor of 2 and regenerated with Bicubic interpolation, leads to significant PSNR degradation and the significant errors are seen around the object edges as all interpolation techniques lead to some form of smoothing of the interpolated images. Our targeted image enhancement technique compensates for the losses in the distorted pixels in the interpolated image. One of the challenges in such an approach is to determine locations of pixels in the interpolated image which are subjected to high distortion. We have given a technique which extracts a location map of the pixels which face high distortion in the interpolated image. This location map can be generated by both the decoder and the encoder without the need for sending location information. Information needed for correcting the distorted pixels is sent as additional information along with the decimated image. <p> </p>Simulation studies indicate that an average PSNR of 28 dB after standard bicubic can be improved to 32 dB, on an average, with targeted enhancement. This improvement is attained with a data over head of only 3%.