In this paper, an adaptive color transform for image compression is introduced. In each block of the image, coefficients of the color transform are determined from the previously compressed neighboring blocks using weighted sums of the RGB pixel values, making the transform block-specific. There is no need to transmit or store the transform coefficients because they are estimated from previous blocks. The compression efficiency of the transform is demonstrated using the JPEG image coding scheme. In general, the suggested transformation results in better peak signal-to-noise ratio (PSNR) values for a given compression level.