Abstract: The present invention provides a system and method for using a hardware-based compression of signals acquired with an magnetic resonance imaging (MRI) system. This allows a first multi-channel MR signal to be compressed to a second multi-channel MR signal having fewer channels than the first MR signal. This system and method reduces the number of RF receivers needed to achieve the sensitivity encoding benefits associated with highly parallel detection in MRI. Furthermore, the system and method reduces bottlenecks connection an MRI system's RF receiver and reconstruction computer and reduces the computational burden of image reconstruction.