The Step Composite Signals is the combination of vital informative signals that are compressed and coded to produce a predefined test image on a display device. It carries the desired sequence of information from source to destination. This information may be transmitted as digital signal, video information or data signal required as an input for the destination module. For testing of display panels, Composite Test Signals are the most important attribute of test signal transmission system. In the current research paper we present an approach for the noise detection in Composite Step Signal by analysing Composite Step Signal waveforms. The analysis of the signal waveforms reveals that the noise affected components of the signal and subsequently noise reduction process is initiated which targets noisy signal component only. Thus the quality of signal is not compromised during noise reduction process.