Knowledge about pellet micro structure is essential in improving their macro behavior. Manual optical microscopy can be used to find such information but it is highly time consuming and tiring for the operator so drawing conclusions from a large amount of data is hard to do in a consistent way. The aim of this work has been to produce a pre study on how an automatic system can be used in as many steps of the analysis as possible. Some previous work has been done within the area but no fully automated methods exist today. In addition, LKAB mines are among the very few iron ore mines in the world that mainly uses magnetite and not hematite ore and therefore has unique production conditions. General studies from other countries are not always applicable and specific production solutions are therefore often needed. The main objectives have been: (1) Automation of image acquisition (2) Separation of pellet and epoxy (3) Finding total percentages of magnetite, hematite and pores. Using the Leica Qwin microscope software and a segmentation method based on Otsu thresholding those three objectives have been achieved with the phases labelled as magnetite, hematite and pores & additives. Also spatial distributions of magnetite, hematite and pores & additives are produced for each pellet. The results are for various reasons not directly comparable to a chemical analysis but comparisons with manual segmentation of images validates the method. Different types of pellets has been tested and the system has produced robust results for the varying cases. The developed system analyses burned pellets consisting of mainly hematite and should therefore be applicable at other mines around the world that have a similar composition of their end product. However the suggested method is still just a prototype that needs to be commercialized if to be used in a larger scale. This thesis also presents suggestions on additional development that could be made to create a system that generates more information about the pellet micro structure than found in this work.