In this paper, we propose a new binarization method for degraded document images. Hence, the existing work is focus on finding a good global or local method in order to remove smear, strains, uneven illumination etc. We propose a new compound method that combines the advantages of both global and local thresholding methods. Our method is applicable for various types of degradation cases and the value of factors could be determined automatically. We compare our method with five state-of-the-art degraded document images. It also has been tested over the dataset that is obtained from the recent Document Image Binarization Contest (DIBCO) 2011 and 2013 for the experiments. Experimental results prove the effectiveness of the proposed technique compared to previous methods. � 2006-2015 Asian Research Publishing Network (ARPN).