The wavelet transform, which provides a multiresolution representation of images, has been widely used in image compression. A new image coding scheme using the wavelet transform and lattice vector quantization is presented. The input image is first decomposed into a hierarchy of three layers containing 10 subimages by discrete wavelet transform. The lowest resolution low-frequency
subimage is scalar quantized with 8 bits/pixel. High-frequency subimages are encoded by lattice vector quantization. A pyramidal piecewise uniform companding approach is used to design the lattice
quantizer according to a piecewise constant approximation to the probability density function of the input source. Due to the fast algorithm of lattice quantization, computational complexity is greatly reduced as compared to the vector quantizers based on the Linde-Buzo-Gray (LBG) algorithm. Computer simulations show that the proposed coding scheme can achieve a high compression ratio while maintaining good reconstruction image quality (both objectively and subjectively).