An algorithm for image recognition and retrieval of image from image collection is developed. Basis of the algorithm is the progressive wavelet correlation. The recognition consists of three incremental steps, each of them quadruples the number of correlation points. The process can be aborted at any stage if the intermediate results indicate that the correlation will not result in a match. The final result is the recognition and retrieval of the required image, if exists in the image collection. Instructions for the choice of correlation threshold value for obtaining desired results are defined. We perform a series of image search experiments that cover the following scenarios: the given image is present in the database; copies of the given image are present but with different names; similar (but not identical) images are present; and the given image is not present. Experiments are performed with data bases up to 1000 images, using the Oracle database and the Matlab component Database Toolbox for operations with databases.