In recent years, various steganography and steganalysis methods have been proposed. Collage steganography, a new type of steganographic method, has been introduced to hide the secret message in a way other than the traditional methods. The limitation of the method is the capacity. This paper presents a new generalized collage steganography, an extension of collage steganography, to improve the capacity problem. The secret message is hidden by incorporating object images with transparent features into a cover image. A proper cover image is chosen based on prior capacity analysis. The selected object image and the translation, rotation and scaling factors in the affine transformation are used to hide the secret message as well as the image pixels, coefficients and/or header files. The appearance of the cover image is changed due to the addition of the object image for embedding. The information is retrieved via template matching techniques. The results demonstrate the relationship between different images and its capacity. Several steganographic image examples are illustrated. Comparisons between the collage steganography and the generalized collage steganography show a higher capacity when using the new steganographic method. © 2008 IEEE.