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In this paper we address the issue of enhancement in the quality of scanned images of old manuscripts. Small por- tions of the text in these manuscripts have degraded with time and are not readable. We propose a segmentation based histogram matching scheme for enhancing these de- graded text regions. To automatically identify the degraded text we use a matched wavelet based text extraction algo- rithm followed by MRF(Markov Random Field) post pro- cessing. Additionally we do background clearing to improve the quality of results. This method does not require any a priori information about the font, font size, background texture or geometric transformation. We have tested our method on a variety of manuscript images. The results show proposed method to be a robust, versatile and effective tool for enhancement of manuscript images.