An adaptive variational partial differential equation (PDE) based aproach for restoration of gray level images degraded by a known shift-invariant blur function and additive noise is presented. The restoration problem of a degraded image is solved by minimizing this model, and this minimizing problem is realized by using Hopfield neural network. In the proposed image restoration model, an adaptive regularization parameter is developed instead of the constant regularization parameter used in previous PDE model. The value of the adaptive regularization parameter changes according to different regions of the image to remove noises and preserve edge better. Several computer simulation results show that the image restoration results of the proposed model both look better and have better SNR (Signal to Noise Ratio) than the previous variational PDE based model.