A method and system for providing a watermark by amplitude modulating data onto signals being repeated from and/or to a cellular telephone handset without degrading the performance of the cellular telephone system. An exemplary cellular repeater system may include a first communication device configured to receive a cellular telephone signal from a handset. The cellular telephone signal is amplified by a variable gain amplifier configured to create an adjusted signal. The amplification factor applied by the variable gain amplifier is controlled by a message encoder configured in accordance with a predetermined encoding scheme. The adjusted signal is then transmitted to a base station by a second communication device.