Since the past decade, multimedia protection technologies have been attracting more and more researchers. Among them, multimedia encryption and watermarking are two typical ones. Multimedia encryptionen codes media data into an unintelligible form, which emphasizes on confidentiality protection. Multimedia watermarking embeds information into media data, which can be detected or extracted and used to authenticate the copyright. Traditionally, in multimedia distribution, media data are encrypted and then transmitted, while the copyright information is not considered. As an important application, to trace illegal distributors, the customer information (e.g., customer ID) is embedded into media data, which can trace illegal distributors. In this chapter, the multimedia distribution scheme based on watermarking technology is investigated, which realizes both confidentiality protection and copyright protection. Firstly, some related works, including multimedia encryption and digital watermarking, are introduced. Then, the existing watermarking-based distribution schemes are reviewed and analyzed. Furthermore, the novel scheme is proposed and evaluated. Finally, some open issues are presented.