The growing Tanzanian population currently estimated to be 48 Million people and their use of vehicles as means of transport has kept increasing making enforcing traffic rules and regulations among road users a major challenge. This calls for a need to have an automated system that monitors the motorists with a pre-defined sense of intelligence. A Vehicle Detection and Recognition Algorithm which can provide automated access to relevant information to a number plate from information systems containing and managing databases on vehicle and their movements is required. This paper presents work on developed algorithm that localizes plate area, extract and segment character, and finally recognizes and interprets registration number from vehicle image. MATLAB R2012b Simulation software with Image Processing toolbox is employed. HSV color space image, morphological and statistical analysis operations were integrated and employed to a vehicle image to compute plate number area. In segmentation the properties like aspect ratio, extent, and area ratio were important measurement parameters. Finally, the template matching database and statistical character extracted from car image was correlated to recognize alphanumeric character to deduce car registration number.