Abstract: In the environment of Internet based E commerce, digital goods are more easily copied and distributed illegally, and therefore, merchant’s intellectual property is not effectively protected. This further greatly disturbs the healthy growing of E commerce. To address this problem, based on digital watermark technique, a registration based copying and distributing detection mechanism is proposed for digital goods, which can perform registering, rebuilding, Internet searching and overlap matching functions for text content, image content, video content, and audio content. At the same time, this mechanism not only can be used in the detection of illegal copying and distributing of digital goods, but also can be used in the tracing of illegal copying and distributing behaviors. Experiments show the effectiveness of the mechanism is good.