Steganography is the art of hiding and transmitting data through apparently innocent carriers in an effort to conceal the existence of data. Image in image Steganography is adopted in this work. The proposed stegosystem uses wavelet transform with sorting to embed the image in the cover to increase stego-image robustness against attacks. Increasing robustness causes decreasing in imperceptibility of the stego-image since the message-image is also embedded in the low frequency component of the cover. To decrease this effect, the coefficients of the embedded image are attenuated by an attenuation factor before adding them to the cover. Fixed and variable attenuation factors were used. The embedded-image is reduced before hiding it into the cover in order to increase the capacity of the stego system. The reduction used is wavelet-based technique with thresholding. To increase system security, wavelet packet algorithm is also used. The random sorting of the sublands prior to embedding make it difficult for the attacker to know the original order of the subbands. The sorting order is sent as a message-driven key. JPEG compression attack (compression factor up to 5) is considered in the work. The imperceptibility of any image is assessed using peak signal-to-noise ratio (PSNR). The stego-image, under certain parameter selection, has good imperceptibility (PSNR above 27 dB), while, at the same time, reconstructed image quality is acceptable (PSNR over 40 dB).