The parabolic equation method is used to study wave propagation in inhomogeneous random media. Differential equations for the average field and second-order mutual coherence function are derived. The equations are similar in form to those obtained for homogeneous media but are considerably more difficult to solve. Approximate solutions for plane wave propagation are obtained and their region of validity determined. Numerical examples of a localized turbulent ball are presented to illustrate some of the features of the average field and mutual coherence function. The results show a high dependence on the transverse extent of the medium and are significantly different from the corresponding results for homogeneous media.