The goals of image steganography are to simultaneously reach maximum embedding capacity, enhanced embedding efficiency, better image quality, and more security. We present a two-step data hiding method that improves image quality, capacity, and embedding efficiency, and also provides stego security. In the first step of the proposed method, the hidden data are encrypted with the key words and shifting method to provide security. In the second stage, we propose adaptive least-significant-bit (LSB)+3 type I and adaptive LSB+3 type II methods to hide encrypted data in the cover image. The image quality of the stego image obtained from the proposed adaptive LSB+3 method is better than the traditional three-bit LSB methods. When maximum data are embedded in the cover image, a peak signal-to-noise ratio (PSNR) greater than 41 dB is reached. Experimental studies show that adaptive LSB+3 type I and adaptive LSB+3 type II methods are higher PSNR values (3.48% and 5.73%) than the standard three-bit LSB substitution methods.