With the result of advancement in todayís technology, digital content can be easily copied, modified, or distributed. Digital watermarking provides the solution to this problem. Most of the digital watermarking methods are divided into two categories: Robust watermarking and fragile watermarking. As a special subset of fragile watermarking, reversible watermarking (lossless or invertible watermarking) enables us to recover the image which is same as the original image pixel by pixel after the content is authenticated. This type of lossless recovery is compulsory in sensitive imagery applications like medical and military purposes. An efficient watermarking algorithm has been implemented using Mat lab which uses the concept of high pass transform coefficients with watermark bits. This work was to find a reversible watermarking algorithm for JPEG2000 standard for medical applications, a (5, 3) wavelet transform is used which is considered as lossless transform in the JPEG2000 standard. In the algorithm, (5, 3) Integer wavelet transformed high pass coefficients are used instead of Haar wavelet transformed coefficients in Mark Tianís algorithm.