An image processing method and apparatus is described for processing a signal from a monochrome or color sensor that may be subject to pixel defects or blemishes. Without prior knowledge of any pixel defects, the processing method examines each pixel value and its neighboring pixel values. A number of tests are applied to the set of pixel values to determine whether the underlying pixel is defective. If the underlying pixel is determined to be defective, the pixel value is replaced by an estimate value derived from the values of its neighboring pixels. Otherwise, the pixel value remains intact.