We introduce a new framework for feature grouping based on factor graphs, which are graphical models that encode interactions among arbitrary numbers of random variables. The ability of factor graphs to express interactions higher than pairwise order (the highest order encountered in most graphical models used in computer vision) is useful for modeling a variety of pattern recognition problems. In particular, we show how this property makes factor graphs a natural framework for performing grouping and segmentation, which we apply to the problem of finding text in natural scenes. We demonstrate an implementation of our factor graph-based algorithm for finding text on a Nokia camera phone, which is intended for eventual use in a camera phone system that finds and reads text (such as street signs) in natural environments for blind users.