A new pan-sharpening approach is proposed for merging the panchromatic image and the multi-spectral image by jointly using IHS and variational method. The substitute image of the intensity component of IHS transform is the optimization solution of the proposed energy functional. The functional consists of three energy terms. The first term extracts the spatial details from the Pan image and injects the details into the MS image. The second term preserves the spectral signature of the MS image by requiring that the low-resolution version of the substitute image should be close to the intensity component. The third term guarantees the smoothness of the optimization solution. The proposed method is validated on the IKONOS and QuickBird dataset. In comparison with the fusion models including extended fast IHS (eFIHS), AWLP and IHS-BT, the prospective fusion results are presented by the proposed model.