A new method of image understanding for forms based on model matching is proposed in this paper as the basis of an OCR which can read a variety of forms. The outline of this method is described as follows. First, ruled lines are extracted from the input image of a form. After that, several lines are grouped as one to be recognised as data corresponding to a sub-form. These lines and subforms are both used for understanding the form, taking into account their feature attributes and the relationships between them. Each feature in the input image of a form is expected to correspond to a feature in one of the model forms, which are described as structured features. This correspondence is represented by a node in an association graph, where an arc represents compatible correspondences established on the basis of feature relationships. The best match is found as the largest maximal clique in the association graph. Experimental results show the method is robust and effective for document images of poor quality, and also for various styles of forms.