We consider several sequential processing algorithms for identifying genes in human DNA, based on detecting CpG ("C proceeds G") islands. The algorithms are designed to capture the underlying statistical structure in a DNA sequence. Sequential processing using a Markov model and a hidden Markov model are shown to identify most CpG islands in annotated (marked) DNA subsequences available from publicly available DNA datasets. We also consider a wavelet-based hidden Markov tree (HMT). In the context of the HMT, we address design of adaptive wavelets matched to CpG islands, this accomplished via lifting and genetic-algorithm optimization.