Abstract: A shape adaptive integer wavelet transform (IWT) algorithm based on lifting scheme is proposed. Through careful analysis of the difference of the coefficients' distribution characteristics between the integer wavelet and the first generation wavelet, it is concluded that the narrow dynamic range of IWT coefficients under a relatively wider threshold interval can result in much less zerotrees. Then a quantization threshold scheme based on an odd number square and a quantization strategy based on binary search are proposed. The scheme is able to use less bits than the scheme based on bit-plane to exactly reconstruct a coefficient. On this basis, a shape adaptive EZW based on IWT and the new binary quantization scheme is proposed. Simulation results prove the rationality of the threshold and the effectiveness of the binary quantization scheme. At the same decode bitrate, the proposed scheme can achieve S/N ratio, which is 0.5-2dB higher PSNR than the traditional threshold and bit-plane based quantization scheme.