In this paper, we present a moving image compression scheme based on the wavelet representation. The multiresolution and multifrequency nature of discrete wavelet transform lends itself and ideal tool for representing images and video signals. Wavelet transform decomposes a video frame into a set of sub-frames with different resolutions corresponding to different frequency bands. These multifre quency nature of frames provide a efficient representation for coding because there are many 0-coefficients in the high frequency bands for natural images. We can compress a frame more compactly if we can maximize the size of 0 run. We design a hilbert-furve-scanning method instead of line-by-line scanning method to maximize it. Multiresolution frames provide a representation of the global motion structure of the video signals at different scales. In our scheme, motion vectors in higher resolution are predicted by the motion vectors in the lower resolution, and are refined at each step. The efficiency of these techniques are illustrated by simulations. It is shown that the motion-compensated wavelet transform coding approach out-performs the conventional transform coding scheme in terms of the objective quality as well as the subjective quality.