In this paper, the authors present a new data hiding method for hiding data in a binary image using edge based grid. Unlike existing block based approaches for data hiding, this method makes use of the grid which is formed of edges along the objects present in input image. These grids are obtained by tracing the object contours from a valid contour starting location in anticlockwise direction. Once the grid is obtained they divide this grid into number of segments called contour segments. These contour segments are checked for embeddabilty depending on the direction in which they are traced.