In this letter, an efficient morphological wavelet coder is proposed. The clustering trend of significant coefficients is captured by a new kind of multiresolution binary dilation operator. The layered and adaptive nature of the subband dilation makes it possible for the coding technique to produce an embedded bit-stream with a modest computational cost and state-of-the-art rate-distortion performance. Morphological wavelet coding appears promising because the localized analysis of wavelet coefficient clusters is adequate to capture intrinsic patterns of the source, which can have substantial benefits for reducing further the data redundancy.