As a result of recent technological advances, a significant (and increasing) number of the images in a typical radiology department are represented in digital form. This includes images that have been captured using digital imaging modalities such as computed tomography and magnetic resonance imaging as well as images that have been digitally converted from film originals as in computed radiography. To provide economical storage of such images and to allow for their efficient transmission over various networks, it becomes necessary to consider digital image compression techniques. In this article, the fundamental concepts of several popular reversible and nonreversible image compression schemes are reviewed. In addition, the performance of the schemes in terms of compression ratio and reconstructed image quality as applied to medical diagnostic images is investigated.