The image compression is the technique which is applied to reduce size of the original image. The image compression can be classified into lossy and loss-less type of compressions. The WDR is the lossy type of compression in which unwanted pixels will be removed from the image. In this work, improvement in the WDR algorithm is been proposed using the algorithm of decision tree. The decision tree is constructed of according to the similarity between the pixels. The pixels which have least similarity with the other pixels will be removed from the image. The simulation is been performed in MATLAB and it is been analyzed that PSNR, MSE and compression ratio parameters are improved with the proposed technique.