Damage localization is a primary objective of damage identification. This paper presents damage localization in beam structure using impact-induced Lamb wave and Frequency Slice Wavelet Transform (FSWT). FSWT is a new time-frequency analysis method and has the adaptive resolution feature. The time-frequency resolution is a vital factor affecting the accuracy of damage localization. In FSWT there is a unique parameter controlling the time-frequency resolution. To improve the accuracy of damage localization, a generalized criterion is proposed to determine the parameter value for achieving a suitable time-frequency resolution. For damage localization, the group velocity dispersion curve (GVDC) of A0 Lamb waves in beam is first accurately estimated using FSWT, and then the arrival times of reflection wave from the crack for some individual frequency components are determined. An average operation on the calculated propagation distance is then performed to further improve the accuracy of damage localization.