Large, high-power laser systems are often designed as reimaging multipass cavities to maximize the extraction of energy from the amplifiers. These multipass cavities often have vacuum spatial filters that suppress the growth of beam instability via B-integral effects. These spatial filters also relay images of laser damage, often nearly superimposing these images in common planes. Also, the fluence damage threshold limits the minimum size of the optics. When used as vacuum barriers in the spatial filters, these large optics present a safety hazard from the risk of implosion if the laser damage were sufficiently large. The objective of the project was to develop algorithms and methods for optical detection and characterization of laser-induced damage of optics. The system should detect small defects (about 5% of the critical size), track their growth over multiple laser shots, and characterize the defects accurately so that the optic can be replaced (at 25% of the critical size) and, hence, minimize the risk of implosion. The depth of field must be short enough to isolate the damaged vacuum barrier from other damaged optics in the beamline, and the system should also be capable of inspecting other optics in the beamline, since damage on one optic can subsequently damage subsequent optics. Laser induced damage starts as a small (<<1mm) crater and grows as material is removed on subsequent laser shots. The highly fractured rough surface of the crater scatters light from the illuminating inspection beam. This scattered light is imaged by the inspection system. Other types of defects may occur as well including inclusions in the bulk glass, tooling marks, and surface contamination. This report will discuss the detection and characterization of crater-like surface defects although the general techniques may prove useful for other types of defects. The work described here covers the development of an image processing approach and specific algorithms for defect detection and characterization in dark and bright ...