An image processing method and system that performs color space transformation on an image to be compressed and obtaining pixel values, performing intra-row differential pulse code modulation coding on the image pixel values to obtain numerical values, and determining whether each of the numerical values is within a preset range. Variable length coding is performed on the numerical value obtained by using a fixed code table if the numerical value is within the range, variable length and by using a dynamic code table if it is not. Low algorithm complexity and fast processing meets the requirement of real-time video transmission. The pixel components of the image can be processed in parallel and adjacent processing steps can be performed in the same clock frequency, thereby remarkably reducing difficulty and cost in FPGA or chip implementation.