A method for inserting a watermark into an audio signal comprising substituting a noise-like signal portion with a replacement noise-like signal portion, and the replacement noise-like signal portion is modulated with watermark data. In a preferred embodiment Perceptual Noise Substitution is used to locate those portions of the audio signal which are noise-like and which may be replaced by synthetic noise modulated with watermark data. Advantageously the inventive method results in a signal having a synthetic noise signal portion which is modulated by watermark data but which is perceived merely as a noisy signal portion and not as watermark data carrying. Furthermore, watermarks incorporated by the inventive method may be adapted to be robust to various audio compression schemes.