This paper discusses about the design and fabrication of vision based Autonomous Underwater Cable Tracking (AUCT) system and its working principle based on the propulsion technique. The AUCT system consists of three levels of controllers namely, higher level controller, Middle level controller and the Lower level controller to navigate the Autonomous Underwater Vehicle (AUV). A single CCD camera and an Ultrasonic distance sensor are used to determine the relative position of the underwater cable with respect to the Autonomous Underwater Vehicle (AUV) in a 3 dimensional space. Visual data provides two dimensions and ultrasonic distance sensor data provides the 3rd dimension. An image filtering technique to reduce some undesirable features is underwater images, is used based on the morphological operator. A real-time algorithm is developed to determine the position of the cable in the image plane by cascading an estimator governed by AUV dynamics, with help of Hough transformation technique. The proposed system will perform very well other than in situations where the cable is covered by waterweeds for a long distance. This system can be used as a solution to the problem of underwater positioning especially in pre-determined areas.