How should I give images rounded corners in Android?

For a more controlled method draw a rounded rectangle and mask it onto your image using the porter-duff Xfer mode of the paint.

First setup the Xfer paint and the rounded bitmap:

Bitmap myCoolBitmap = ... ; // <-- Your bitmap you want rounded    
int w = myCoolBitmap.getWidth(), h = myCoolBitmap.getHeight();

// We have to make sure our rounded corners have an alpha channel in most cases
Bitmap rounder = Bitmap.createBitmap(w,h,Bitmap.Config.ARGB_8888);
Canvas canvas = new Canvas(rounder);    

// We're going to apply this paint eventually using a porter-duff xfer mode.
// This will allow us to only overwrite certain pixels. RED is arbitrary. This
// could be any color that was fully opaque (alpha = 255)
Paint xferPaint = new Paint(Paint.ANTI_ALIAS_FLAG);
xferPaint.setColor(Color.RED);

// We're just reusing xferPaint to paint a normal looking rounded box, the 20.f
// is the amount we're rounding by.
canvas.drawRoundRect(new RectF(0,0,w,h), 20.0f, 20.0f, xferPaint);     

// Now we apply the 'magic sauce' to the paint  
xferPaint.setXfermode(new PorterDuffXfermode(PorterDuff.Mode.DST_IN));

Now apply this bitmap ontop of your image:

Bitmap result = Bitmap.createBitmap(myCoolBitmap.getWidth(), myCoolBitmap.getHeight() ,Bitmap.Config.ARGB_8888);
Canvas resultCanvas = new Canvas(result)
resultCanvas.drawBitmap(myCoolBitmap, 0, 0, null);
resultCanvas.drawBitmap(rounder, 0, 0, xferPaint);

Bitmap with rounded corners now resides in result.

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