Forest density expressing the stocking status constitutes the major stand physiognomic parameter of Indian forest. Density and age are often taken as surrogate to structural and compositional changes that occur with the forest succession. Satellite remote sensing spectral response is reported to provide information on structure and composition of forest stands. The various vegetation indices are also correlated with forest canopy closure. The paper presents a three way crown density model utilizing the vegetation indices viz., advanced vegetation index, bare soil index and canopy shadow index for classification of forest crown density. The crop and water classes which could not be delineated by the model were finally masked from normalized difference vegetation index and TM band 7 respectively. The rule based approach has been implemented for land use and forest density classification. The broad land cover classification accuracy has been found to be 91.5%. In the higher forest density classes the classification accuracy ranged between 93 and 95%, whereas in the lower density classes it was found to be between 82 and 85%.