The traditional watershed algorithm has the disadvantage of over-segmentation and interference with an image by reflected light. We propose an improved watershed color image segmentation algorithm. It is based on a morphological gradient. This method obtains the component gradient of a color image in a new color space is not disturbed by the reflected light. The gradient image is reconstructed by opening and closing. Therefore, the final gradient image is obtained. The maximum inter-class variance algorithm is used to obtain the threshold automatically for the final gradient image. The original gradient image is forcibly calibrated with the obtained binary labeled image, and the modified gradient image is segmented by watershed. Experimental results show that the proposed method can obtain an accurate and continuous target contour. It will achieve the minimum number of segmentation regions following human vision. Compared with similar algorithms, this way can suppress the meaningless area generated by the reflected light. It will maintain the edge information of the object well. It will improve the robustness and applicability. From the experimental results, it can be seen that compared with the region-growing method and the automatic threshold method; the proposed algorithm has a great improvement in operation efficiency, which increased by 10%. The accuracy and recall rate of the proposed algorithm is more than 0.98. Through the experimental comparison, the advantages of the proposed algorithm in object segmentation can be more intuitively illustrated.