Wireless Sensor Network (WSN) requires robust and efficient communication protocols to save energy and enhance network lifetime. However the adverse impacts caused by radio irregularities and fading increases the energy consumption and thereby reduces the WSN lifetime. To reduce the fading effects in wireless channel, Multi-Input Multi-Output (MIMO) scheme is utilized for sensor network. The network lifetime can be maximized by selecting the cooperative nodes for MIMO communication. Hence this paper proposes a coalition formation game to select the cooperative nodes for enabling packet transmission using cooperative MIMO utilizing Space Time Block Code (STBC). This enables higher energy savings and longer network lifetime by allowing nodes to transmit and receive information jointly.