A face recognition algorithm based on modular PCA approach is presented in this paper. The proposed algorithm when compared with conventional PCA algorithm has an improved recognition rate for face images with large variations in lighting direction and facial expression. In the proposed technique, the face images are divided into smaller sub-images and the PCA approach is applied to each of these sub-images. Since some of the local facial features of an individual do not vary even when the pose, lighting direction and facial expression vary, we expect the proposed method to be able to cope with these variations. The accuracy of the conventional PCA method and modular PCA method are evaluated under the conditions of varying expression, illumination and pose using standard face databases.