error due to function application

When I run the following code it gives the error:

Error: File: image_processing_project.m Line: 55 Column: 1

Function definitions are not permitted in this context.

I think there must be something wrong with the way I've placed the functions in the following code:

M = imread('C:\Users\bostock_h\Documents\Images\130510_162.jpg');
M = int16(M);

x = 975;  %dimensions of the image
y = 1010;
sum=0;
steps = 12; %the number of steps taken for the average
lowlimit = 40; %minimum value to pass
highlimit = 200; %maximum value to pass
movel = 10; %amount of pixels moved to the left after check
prog = 0; 
pixelnum = (x - movel - 1)*y; %Total number of pixels in the image
%Main loop begin
for j = 1:y
    for i1 = movel + 1:x
    c = checkright (i1,j); 

      if c ~= 0
          b = 1;
      else
          b = -1;
      end

      if c == 0
          c = checkleft (i1,j);
      end
      if c == -1 
          if b == 1
          M(j,i1-movel) = 1;
          end 
      end
      if c == 1
          if b == 1
          M(j,i1-movel) = 250;
          end 
      end 
      if c == 1
          if b == -1
          M(j,i1+movel) = 250;
          end 
      end
      if c == -1
          if b == -1
          M(j,i1+movel) = 1;
          end    
      end
      prog = prog + 1;
      percent = (prog / pixelnum) * 100
      end
  end

imagesc(M)
colormap(gray)

function c = checkright(i1,j)
x1 = 1;
y1 = 0;
c = checkhorizontal(i1,j,x1);
end

function c = checkleft(i1,j)
x1 = -1;
y1 = 0;
c = checkhorizontal(i1,j);

function c = checkhorizontal(i1,j,x1)
for n = 0:steps
        sum = M(j, i1 + n*x1) + sum;
end
avg = sum / steps;
if avg < lowlimit
    c = -1*x1;
end 

if avg > highlimit
    c = 1*x1;
end
end

Answer 1

[Walter Roberson]

The first line of your file named "image_processing_project.m" must be

function image_processing_project