A new algorithm for the contrast enhancement of images, based on the theory of Partitioned Iterated Function System (PIFS), is presented. A PIFS consists of contractive transformations, such that the original image is the fixed point of the union of these transformations. Each transformation involves the contractive affine spatial transform of a square block, as well as the linear transform of the gray levels of its pixels. The PIFS is used in order to create a lowpass version of the original image. The contrast-enhanced image is obtained by adding the difference of the original image with its lowpass version, to the original image itself. Quantitative and qualitative results stress the superior performance of the proposed contrast enhancement algorithm against two other widely used contrast enhancement methods.