To reduce data acquisition cost, this study proposed a novel method of individual tree height estimation and canopy extraction based on fusion of an airborne multispectral image and photogrammetric point cloud. A fixed-wing drone was deployed to acquire the true color and multispectral images of a shelter forest. The Structure-from-Motion (SfM) algorithm was used to reconstruct the 3D point cloud of the canopy. The 3D point cloud was filtered to acquire the ground point cloud and then interpolated to a Digital Elevation Model (DEM) using the Radial Basis Function Neural Network (RBFNN). The DEM was subtracted from the Digital Surface Model (DSM) generated from the original point cloud to get the canopy height model (CHM). The CHM was processed for the crown extraction using local maximum filters and watershed segmentation. Then, object-oriented methods were employed in the combination of 12 bands and CHM for image segmentation. To extract the tree crown, the Support Vector Machine (SVM) algorithm was used. The result of the object-oriented method was vectorized and superimposed on the CHM to estimate the tree height. Experimental results demonstrated that it is efficient to employ point cloud and the proposed approach has great potential in the tree height estimation. The proposed object-oriented method based on fusion of a multispectral image and CHM effectively reduced the oversegmentation and undersegmentation, with an increase in the
F
-score by 0.12–0.17. Our findings provided a reference for the health and change monitoring of shelter forests as well.