Now a days, maintaining customer loyalty and attention span of the customers are major challenges faced by the retail industry. This leads to the need for reinforcement of marketing strategies from time to time. This project “CUSTOMER SEGMENTATION” main objective is to segment the customer by analyzing their behavior, their needs and their interests. It is a systematic approach for targeting customers and providing maximum profit to the organizations. An important initial step is to analyze the data of sales from the purchase history and determine the parameters that have the maximum correlation. Based on respective clusters, proper resources can be channeled towards profitable customers using machine learning algorithms.