During the wafer dicing process, the die are separated from a wafer of semiconductor. The dicing saw will leave the damage on the backside of the wafer and this damage needs to be accessed and inspected. The main damage on the backside of the wafer is chipping and delamination that can reduce the die strength. Backside chipping becomes a yield issue when micro-cracks exceed a certain length which may increase the sensitivity of the devices to thermal cycling and lower their reliability. This paper proposes an automated image analysis algorithm to measure the damage occurring during the die segregation process. The main elements of the system are the image capture tool and the algorithm which analyzes the captured images and quantifies the amount of chipping and delamination on the die edge along with the shift in the location of the die within the frame. The system does not require a reference image and can automatically measure the extent of chipping and delamination without human supervision. The paper provides examples of the application of the algorithm to a sequence of images.