An image processing apparatus includes a halftone processing unit and a multi-level gradation processing unit. The halftone processing unit is configured to perform a halftone process for a target image and generate a binary image corresponding to the target image. The multi-level gradation processing unit is configured to (a) set a target pixel as a dot pixel in the binary image, (b) determine whether a dot exists on plural first periphery pixels with a predetermined first distance from the target pixel and plural second periphery pixels with a predetermined second distance from the target pixel or not, (c) derive a gradation level of the target pixel among predetermined three or more gradation levels on the basis of a number of dots on the plural first periphery pixels and a number of dots on the plural second periphery pixels and thereby generate a multi-level gradation image.