The present invention relates to an image processing apparatus which suppresses appearance of a color moire of a color image signal of a wide dynamic range which is produced using an image signal acquired using, for example, a CCD image sensor of the single plate type or the like. A gradation conversion section 71 performs a gradation conversion process for a color mosaic image M to produce a modulated color mosaic image Mg. Color difference image production sections 72 and 3 use the modulated color mosaic image Mg to produce color difference images C and D, respectively. A luminance image production section 74 uses the modulated color mosaic image Mg and the color difference signals C and D to produce a luminance image L. A color space conversion section 75 performs a color space conversion process for the color difference images C and D and the luminance image L to produce modulated images. Gradation reverse conversion sections 76 to 78 perform a modulation reverse conversion process for the modulated images to produce output images R, G and B, respectively. The present invention can be applied, for example, to a digital camera.