AbstractCompact and low‐cost video coding equipment is indispensable for the economical realization of visual communication services such as traffic monitoring entertainment relay, etc. This paper describes an LSI oriented coding algorithm which is effective for the compact and economical realization of intra‐frame coding equipment. First, an intra‐frame combinational difference coding algorithm is proposed. the encoded picture quality obtained using this coding algorithm is sufficient even for complicated scenes of TV signals. the predictive coding circuit LSIs for realizing this coding algorithm are also developed. Moreover, the variablelength word multiplexing circuit is shown to be suitable for LSI, and LSIs for this are also developed. Furthermore, coding equipment using the coding algorithm and the LSIs were developed, and its compactness is confirmed. A coding experiment was performed by using the developed equipment and it is shown that the equipment is capable of transmitting good quality ITV signals at a 32‐Mb/s rate.