The security of digital image watermarking is improved by scrambling the watermark using different chaotic maps or cellular automata in such a way that an unauthorized person can't recover the watermark without the secret keys. In this proposed scheme three secret keys are used in which one key is used to make the watermark chaotic and other two keys are used for scrambling the cover image. In this scheme the cover image is scrambled by using the game of life cellular automation and the watermark is made chaotic by performing the X-OR operation between the binary watermark and logistic map. Although it increases the computational complexities, but the security of watermarking is improved by involving three secret keys. In addition, for ensuring imperceptibility and making the watermarking robust, a mask of size 3×3 is run over the scrambled cover image in which one bit of chaotic watermark is embedded in 3×3 block of cover image by modifying one of the neighbor pixels. Then the scrambled modified cover image is descrambled using game of life cellular automation for obtaining watermarked image. This proposed combined chaotic and cellular automata based watermarking scheme is compared with existing chaotic based watermarking schemes and gives satisfactory values of Peak Signal to Noise (PSNR), Mean Squared Error (MSE) and Normalized Correlation (NC).