Many moons ago I blogged about people's misconceptions regarding digital watermarks and how often they're misconstrued for visual watermarks. (You can read that choice post here if you like.) I failed to mention that yes, you can add both a visual and digital watermark to your images.
There are quite a number of available visual watermarking applications out there, so choose carefully (for onesy-twosies, we recommend just using a layer in Photoshop, but there are also automatic tools out there). However, when it comes to digital watermarking, Digimarc is the expert, so don't search any further. Don't forget though, the visible watermark, which is most often text or some sort of a logo sitting on top of your image, can negatively impact the visible quality of what you want to showcase.
I recently ran across this About.com article that actually talks about "How to Watermark Your Photos" and they give you many options to choose from. I found it pretty accurate, so if you have time... check it out here.