Abstract: Nowadays, digital images are used in many areas in everyday life, but they tend to be big. This increases amount of information leads us to the problem of image data storage. For example, it is common to have a representation a color pixel as a 24-bit number, where the channels red, green, and blue employ 8 bits each. In consequence, this kind of color pixel can specify one of 224 ¼ 16:78 million colors. Therefore, an image at a resolution of 512 £ 512 that allocates 24 bits per pixel, occupies 786,432 bytes. That is why image compression is important. An important feature of image compression is that it can be lossy or lossless. A compressed image is acceptable provided these losses of image information are not perceived by the eye. It is possible to assume that a portion of this information is redundant. Lossless Image Compression is defined as to mathematically decode the same image which was encoded. In Lossy Image Compression needs to identify two features inside the image: the redundancy and the irrelevancy of information. Thus, lossy compression modifies the image data in such a way when they are encoded and decoded, the recovered image is similar enough to the original one. How similar is the recovered image in comparison to the original image is defined prior to the compression process, and it depends on the implementation to be performed. In lossy compression, current image compression schemes remove information considered irrelevant by using mathematical criteria. One of the problems of these schemes is that although the numerical quality of the compressed image is low, it shows a high visual image quality, e.g. it does not show a lot of visible artifacts. It is because these mathematical criteria, used to remove information, do not take into account if the viewed information is perceived by the Human Visual System. Therefore, the aim of an image compression scheme designed to obtain images that do not show artifacts although their numerical quality can be low, is to eliminate the information that is not visible by the Human Visual System. Hence, this Ph.D. thesis proposes to exploit the visual redundancy existing in an image by reducing those features that can be unperceivable for the Human Visual System. First, we define an image quality assessment, which is highly correlated with the psychophysical experiments performed by human observers. The proposed CwPSNR metrics weights the well-known PSNR by using a particular perceptual low level model of the Human Visual System, e.g. the Chromatic Induction Wavelet Model (CIWaM). Second, we propose an image compression algorithm (called Hi-SET), which exploits the high correlation and self-similarity of pixels in a given area or neighborhood by means of a fractal function. Hi-SET possesses the main features that modern image compressors have, that is, it is an embedded coder, which allows a progressive transmission. Third, we propose a perceptual quantizer (½SQ), which is a modification of the uniform scalar quantizer. The ½SQ is applied to a pixel set in a certain Wavelet sub-band, that is, a global quantization. Unlike this, the proposed modification allows to perform a local pixel-by-pixel forward and inverse quantization, introducing into this process a perceptual distortion which depends on the surround spatial information of the pixel. Combining ½SQ method with the Hi-SET image compressor, we define a perceptual image compressor, called ©SET. Finally, a coding method for Region of Interest areas is presented, ½GBbBShift, which perceptually weights pixels into these areas and maintains only the more important perceivable features in the rest of the image. Results presented in this report show that CwPSNR is the best-ranked image quality method when it is applied to the most common image compression distortions such as JPEG and JPEG2000. CwPSNR shows the best correlation with the judgement of human observers, which is based on the results of psychophysical experiments obtained for relevant image quality databases such as TID2008, LIVE, CSIQ and IVC. Furthermore, Hi-SET coder obtains better results both for compression ratios and perceptual image quality than the JPEG2000 coder and other coders that use a Hilbert Fractal for image compression. Hence, when the proposed perceptual quantization is introduced to Hi-SET coder, our compressor improves its numerical and perceptual e±ciency. When ½GBbBShift method applied to Hi-SET is compared against MaxShift method applied to the JPEG2000 standard and Hi-SET, the images coded by our ROI method get the best results when the overall image quality is estimated. Both the proposed perceptual quantization and the ½GBbBShift method are generalized algorithms that can be applied to other Wavelet based image compression algorithms such as JPEG2000, SPIHT or SPECK.