A system and method for enabling the removal of decoded pictures from a decoded picture buffer as soon as the decoded pictures are no longer needed for prediction reference and future output. An indication is introduced into the bitstream as to whether a picture may be used for inter-layer prediction reference, as well as a decoded picture buffer management method which uses the indication. The present invention includes a process for marking a picture as being used for inter-layer reference or unused for inter-layer reference, a storage process of decoded pictures into the decoded picture buffer, a marking process of reference pictures, and output and removal processes of decoded pictures from the decoded picture buffer.