Fisheye image rectification and estimation of intrinsic parameters for real scenes have been addressed in the literature by using line information on the distorted images. In this paper, we propose an easily implemented fisheye image rectification algorithm with line constrains in the undistorted perspective image plane. A novel Multi-Label Energy Optimization (MLEO) method is adopted to merge short circular arcs sharing the same or the approximately same circular parameters and select long circular arcs for camera rectification. Further we propose an efficient method to estimate intrinsic parameters of the fisheye camera by automatically selecting three properly arranged long circular arcs from previously obtained circular arcs in the calibration procedure. Experimental results on a number of real images and simulated data show that the proposed method can achieve good results and outperforms the existing approaches and the commercial software in most cases.