A new image coding technique in wavelet transform domain has been proposed. To achieve lower coding rates and good reconstructed image quality, some of wavelet coefficients were removed by thresholding and quantized in accordance with the sensitivity of the human visual system(HVS). For each block of subimages in wavelet transform domain, block thresholding makes use of the frequency characteristic and statistical property of wavelet coefficients to remove the unimportant wavelet coefficients. The location information of quantized blocks and removed blocks were encoded using runlength coder which is an effective coding method for the location runs of the exponential distribution. Quantized coefficients were encoded using variable length coder which matches well to their distribution. It has been shown that the proposed coding scheme provides better performance at low rate than the convential multifrequency coding scheme.