Diffuse optical tomography (DOT) is a promising noninvasive imaging modality capable of providing the functional characteristics (oxygen saturation and hemodynamic states) of thick biological tissue by quantifying the optical parameters. The parameter recovery problem in DOT is a nonlinear, ill-posed and ill conditioned inverse problem. The non-linear iterative methods are usually employed for image reconstruction in DOT by utilizing Tikhonov based regularization approach. These methods employ l2-norm based regularization where the constant regularization parameter is determined either empirically or generalized cross validation methods or L curve method. The reconstructed images look smoother or noisy depending on the chosen value of the regularization constant. Moreover the edges information of the inclusions appeared to be blurred in such constant regularization methods. In this study we proposed a method to retrieve and utilized a non-zero support (possible tumor location) to generate a spatially varying regularization map. The inclusions locations were determined by considering the imaging problem as a multiple measurements vector (MMV) problem. Based on the recovered inclusion positions spatially regularization map was generated to be used in non-linear image reconstruction framework. The results retrieved with such spatially varying priors shows slightly improved image reconstruction in terms of better contrast recovery, reduction in background noise and preservation of edge information of inclusions compared with the constant regularization approach.