We have theoretically investigated the dynamic range compression in a 45 deg-cut BaTiO3 crystal. Modified coupled wave equations, which take into account different directions of scattered beams and the angle dependence of the coupling coefficient, are used. The same equations are employed to study the behavior of beam fanning with and without biasing illumination. Logarithmic operation is demonstrated using biasing illumination in the beam fanning geometery. Results indicate that there is a choice concerning the dynamic range of biasing illumination and the input range over which log operation is achieved. An all-optical configuration shows a very small dynamic range over which log operation can be obtained. A hybrid optoelectronic module of such a log processor is shown to have large operating range. Experimental results are presented to demonstrate the feasibility of this concept. Once the given crystal is characterized to give a standard lookup table for logarithmic operation, the results can be applied to 2-D (image) information. A configuration is suggested for such a 2-D processor, which is expected to find applications in joint-transform correlation, analog computation, and logarithmic filtering.