Abstract: Image to be transmitted is divided into blocks. The block size varies in each stage of transmission. The blocks are down-sampled to a fixed size for polynomial approximation coding (PAC). The PAC's are derived from a regressive model which is a statistical tool for data analysis. A two-dimensional polynomial equation is used to approximate the relation of the image data and their positions. The coefficients of the 2-D polynomial equation is coded and transmitted to represent the initial image. In the next stage, same or similar coding is conducted to the residual image. After a decided number of stages of transmission an approximated image is reconstructed. A novel iterative coding system for progressive image transmission is disclosed.