ABSTRACT The Block Truncation Coding (BTC) is one of the lossy image compression algorithms. In this paper, we have proposed a method called the Improved Adaptive Block Truncation Coding (IABTC) based on Adaptive Block Truncation Coding (ABTC). The feature of inter-pixel redundancy is exploited to reduce the bit-rate further by retaining the quality of the reconstructed images. The proposed method outperforms the existing BTC based methods both in terms of bit-rate and PSNR values. General Terms Image Compression Keywords Compression, block, bit plane, bpp, PSNR, quantizers 1. INTRODUCTION Data compression algorithms lead to reduction in transmission time and storage cost. Image compression techniques are classified into lossy and lossless techniques. In lossless techniques, the reconstructed image will be the exact replica of the original image whereas in lossy techniques, the reconstructed image will be an approximation of the original image. One of the main goals for image data compression is to reduce redundancy in the image block as much as possible. That is, it is very important to represent an image with as few bits as possible while maintaining good image quality. xiBoth compression and decompression algorithms should be simple and efficient. BTC is one of the simple and easy to implement image compression algorithms [1]. It comes under lossy image compression techniques. Though some data is lost, it does not make much difference to the Human Visual System (HVS). is the original pixel value of the block. One such lossy image compression techniques is Block Truncation Coding (BTC) technique. BTC has the advantage of being easy to implement when or 0s for each block is called acompared to Vector Quantization [8] and Transform Coding [9, statistical moments 10]. BTC achieves 2 bits per pixel (bpp) with low computational complexity [11]. Many techniques with modifications to BTC have been proposed to reduce the bit-rate obtained with normal BTC: Gallagher [12] proposed a Median Filter Roots method; Yung-Gi Wu [13] proposed Probability based Block Truncation Image Bitplane Coding; Yu-Chen Hu [14] presented a Modified BTC with Predictive Technique and Bitplane Coding with Edge Pattern. In this paper, we have presented a method named Improved Adaptive Block Truncation Coding (IABTC) based on the Adaptive Block Truncation Coding (ABTC) method. Few other existing Block Truncation Coding (BTC) based methods are discussed in Section 2. The proposed method is explained in Section 3. Results are discussed in Section 4 and the conclusion is given in Section 5.