There are a number of universities which are developing pico and nano satellite for research and studies and will continue to increase in the future. Most of them also have specific attitude determination methods and associated sensors, but still a very accurate attitude determination sensor system is not available for small satellites other than sun sensors and magnetometers. Considering the accuracy and performance star sensor is the best choice, but the major drawbacks are the cost, effort and weight of the star sensor. The objective of the thesis work is to develop attitude determination software for a small low cost star sensor which can be used in pico and nano satellites. Modern miniaturization of electronics and hardware and low cost due to mass production has paved new way to develop a miniature sensor for small satellites in university projects. The work is mainly concentrated on developing a prototype software for the current star sensor project undergoing at the University of Wuerzburg, known as STELLAR. The prototype software is build in MATLAB 7 on a normal PC and tested for publicly available various star images and generated images.