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Texture in high resolution satellite images requires substantial improvement in the conventional segmentation algorithms. The use of wavelet packet transforms for texture analysis and image classification of high spatial resolution LISS IV imagery provide more details about the urban areas. This paper analyses the performance of a combination of Wavelet Packet Statistical Features (WPSFs) and Wavelet Packet Co-occurrence Features (WPCFs) for the classification of LISS IV images. The classification accuracy per pixel is improved in this paper by varying the window size. Four indices—user’s accuracy, producer’s accuracy, overall accuracy and kappa co-efficient are used to assess the accuracy of the classified data. Experimental results show that a multi-band and multi-level wavelet packet approach can be used to drastically increase the classification accuracy.