Abstract: A new approach to multispectral image compression where the intra- and cross-band correlations are jointly exploited in a surprisingly simple yet very effective manner. The key component of the algorithm is a bijection mapping of the original multispectral image into a virtual 2 dimensional scalar image. By optimally mapping the multispectral image set into a single 2 dimensional array and by subsequently applying a scalar image coding algorithm, the spatial correlation and the spectral correlation of the multispectral data set are jointly exploited. Based on the statistical characteristics of the multispectral data, the bijection mapping can be optimized to minimize the distortion introduced by the compression algorithm. The optimization reduces to the maximization of a function of the second-order statistics of the multispectral data.