This paper proposes a novel robust digital color image watermarking algorithm which combines color image feature point extraction, shape image normalization and QPCA (quaternion principal component algorithm) based watermarking embedding (QWEMS) and extraction (QWEXS) schemes. The feature point extraction method called Mexican Hat wavelet scale interaction is used to select the points which can survive various attacks and also be used as reference points for both watermarking embedding and extraction. The normalization shape image of the local quadrangle image of which the four corners are feature points of the original image is invariant to translation, rotation, scaling and skew, by which we can obtain the relationship between the feature images of the original image and the watermarked image which has suffered with geometrical attacks. The proposed QWEMS and QWEXS schemes which denote the color pixel as a pure quaternion and the feature image as a quaternion matrix can improve the robustness and the imperceptibility of the embedding watermarking. To simplify the eigen-decomposition procedure of the quaternion matrix, we develop a calculation approach with which the eigen-values and the corresponding eigen-vectors of the quaternion matrix can be computed. A binary watermark image is embedded in the principal component coefficients of the feature image. Simulation results demonstrate that the proposed algorithm can survive a variety of geometry attacks, i.e. translation, rotation, scaling and skew, and can also resist the attacks of many signal processing procedures, for example, moderate JPEG compression, salt and pepper noise, Gaussian filtering, median filtering, and so on.