Pattern recognition and Gesture recognition are the growing fields of research. Being a significant part in non verbal communication hand gestures are playing vital role in our daily life. Hand Gesture recognition system provides us an innovative, natural, user friendly way of interaction with the computer which is more familiar to the human beings. Gesture Recognition has a wide area of application including human machine interaction, sign language, immersive game technology etc. By keeping in mind the similarities of human hand shape with four fingers and one thumb, this paper aims to present a real time system for hand gesture recognition on the basis of detection of some meaningful shape based features like orientation, centre of mass (centroid), status of fingers, thumb in terms of raised or folded fingers of hand and their respective location in image. The approach introduced in this paper is totally depending on the shape parameters of the hand gesture. It does not consider any other mean of hand gesture recognition like skin color, texture because these image based features are extremely variant to different light conditions and other influences. To implement this approach we have utilized a simple web cam which is working on 20 fps with 7 mega pixel intensity. On having the input sequence of images through web cam it uses some pre-processing steps for removal of background noise and employs K-means clustering for segmenting the hand object from rest of the background, so that only segmented significant cluster or hand object is to be processed in order to calculate shape based features. This simple shape based approach to hand gesture recognition can identify around 45 different gestures on the bases of 5 bit binary string resulted as the output of this algorithm. This proposed implemented algorithm has been tested over 450 images and it gives approximate recognition rate of 94%.