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I want to delineate surface water feature of my Landsat raster image and also want to calculate the area of water body. I have learned through internet that NDWI can be used to delineate open water feature.

How can I calculate NDWI value using arcgis 10.1 ?

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You can calculate the NDWI using basic raster calculator in arcmap. You need to use Landsat bands 3 and 5 (Landsat 8 OLI), and simply calculate a new raster with an algebraic expression:

(Band 3 - Band 5)/(Band 3 + Band 5)

You should preferably use images corrected to TOA. In this example I have bands 3 and 5 enter image description here

The result is a raster with values between -1 and 1 (hence the "Normalized" in the index name. You can see in the histogram that water values are close to 1, and the rest of the pixels are between -1 and 0. enter image description here

So to calculate the area, you first have to extract these values into a separate raster with a raster calculator or reclassify tool, the result of which you can convert into a vector layer, which you can then easily calculate its dimensions.

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