A technique for obtaining the digital Walsh-Hadamard transform of two-dimensional discrete pictures in real time is presented. A considerable reduction in total time for the transformation of a picture results since the process of scanning and digitizing one picture line overlaps with computations on the previous line. This is accomplished by operating on each picture line as it is generated from the scanner, instead of starting the transformation operation after the entire picture has been scanned. Two theorems are presented which decompose a picture by row or by column to facilitate real-time transformation. Based on these theorems, a hardware machine for real-time parallel Walsh-Hadamard transformation is introduced.