Focusing on the fusion of Synthetic Aperture Radar (SAR) and panchromatic images, a novel fusion algorithm based on the imaging characteristic of the SAR image is presented. Two measurements named region information entropy and ratio of region mean are presented in the nonsubsampled contourlet transform (NSCT) domain so that the SAR image can be split into roughness regions, smoothness regions and highlight point target regions. The algorithm performs the different fusion rules for each particular region independently. Experimental results show that the fused image not only joins the target information in the SAR image that is difficult to identify in the panchromatic image but also preserves the spatial resolution of the panchromatic image. The algorithm performs significantly better than the wavelet transform and the pixel-based NSCT.Index Terms -image fusion; nonsubsampled contourlet transform; Region Information Entropy; Ratio of Region Mean.