The optical classification of the different water types provides vital input for studies related to primary productivity, water clarity and determination of euphotic depth. Image data of the IRSP3 MOS-B, for Path 90 of 27th February, 1998 was used for deriving vertical diffuse attenuation coefficient (K_d) and an optical classification based onK_d values was performed. An atmospheric correction scheme was used for retrieving water leaving radiances in blue and green channels of 412, 443, 490 and 550 nm. The upwelling radiances from 443 nm and 550 nm spectral channels were used for computation of vertical diffuse attenuation coefficientK_d at 490 nm. The waters off the Gujarat coast were classified into different water types based on Jerlov classification scheme. The oceanic water type IA (K_d range 0.035-0.040m^-1), type IB (0.042-0.065 m^-1), type II (0.07-0.1m^-1) and type III (0.115-0.14m^-1) were identified. For the coastal waters along Gujarat coast and Gulf of Kachchh, K_d(490) values ranged between 0.15 m^-1 and 0.35 m^-1. The depth of 1% of surface light for water type IA, IB, II and III corresponds to 88, 68, 58 and 34 meters respectively. Classification of oceanic and coastal waters based onK_d is useful in understanding the light transmission characteristics for sub-marine navigation and under-water imaging.