Abstract: In this paper, an embedded image coder is presented, which provides very effective, progressive image transmission while achieving superior visual performance for SPIHT. The visual gains are achieved by exploiting human visual masking characteristics to weigh wavelet coefficients according to their perceptual importance, causing a reordering of the coefficients. The reduced bit-rates are achieved by merging the first and second passes of the SPIHT algorithm. The experiment results show that the new still image compression scheme provides higher perceptual quality and higher PSNRs than SPIHT etc., especially at low bit rates.