With the reversible data hiding method based on pixel-value-ordering, data are embedded through the modification of the maximum and minimum values of a block. A significant relationship exists between the embedding performance and the block size. Traditional pixel-value-ordering methods utilize pixel blocks with a fixed size to embed data; the smaller the pixel blocks, greater is the embedding capacity. However, it tends to result in the deterioration of the quality of the marked image. Herein, a novel reversible data hiding method is proposed by incorporating a block merging strategy into Li et al.’s pixel-value-ordering method, which realizes the dynamic control of block size by considering the image texture. First, the cover image is divided into non-overlapping 2×2 pixel blocks. Subsequently, according to their complexity, similarity and thresholds, these blocks are employed for data embedding through the pixel-value-ordering method directly or after being emerged into 2×4, 4×2, or 4×4 sized blocks. Hence, smaller blocks can be used in the smooth region to create a high embedding capacity and larger blocks in the texture region to maintain a high peak signal-to-noise ratio. Experimental results prove that the proposed method is superior to the other three advanced methods. It achieves a high embedding capacity while maintaining low distortion and improves the embedding performance of the pixel-value-ordering algorithm.