A novel image encryption algorithm making using of hyper-chaos and DNA sequence is presented here. A four-dimensional hyper-chaos system is used to generate the pseudo-random sequence, which is transformed into a biologic DNA sequence to diffuse the image blocks. A circular permutation is performed on the plain-image when it is in DNA status. Together with classical structure of permutation plus diffusion, the simulation results show that the proposed image encryption algorithm has a satisfactory performance. Moreover, our method can resist the known-plaintext and chosen-plaintext attacks with four parameters r i (i = 1,2,3,4) dependent on the plain-image. These parameters generate different key streams for different plain-image even if the initial conditions are the same.