A simple yet efficient image data compression method is presented. This method is based on coding only those segments of the image that are perceptually significant to the reconstruction of the image. Sequences of image pixels whose gray-level differences from the pixels of the previous row exceed two prespecified thresholds are considered significant. These pixels are coded using a differential pulse code modulation scheme that uses a 15-level recursively indexed nonuniform quantizer for the first pixel in a segment and a 7-level recursively indexed nonuniform quantizer for all other pixels in the segment. The quantizer outputs are Huffman coded. Simulation results show that this scheme can obtain subjectively satisfactory reconstructed images at low bit rates. It is also computationally very simple, which makes it amenable to fast implementation.