The purpose of this thesis is to do a careful analysis of several of the problems involved in the inspection of SMD’s (Surface Mount Devices) and to propose algorithms for their solution. First, a short introduction to the area of research and a motivation for this work is given. Second, the components of a vision system, its capabilities, and its limitations are studied in detail. Emphasis is put on applicable solutions for the system in question. Third, algorithms are developed for locating SMD‘s for automatic visual inspection and their performance is investigated experimentally. Finally, an implementation of an image processing development system for low-cost hardware (IBM-PC) is presented. The necessary hardware is described, and an expandable, but in itself complete, software development environment is given.