When image data is compressed in units of blocks, if a compressed data amount D obtained by reversibly compressing a block, and a predetermined value L satisfy D.ltoreq.L, the block is reversibly compressed; if they satisfy D>L, the block is irreversibly compressed, so that computer-created image data is compressed while preventing deterioration of image quality, and a gradation image or a natural image is efficiently compressed. When a pixel of interest has the same value as color data (C.sub.1) of the immediately preceding pixel, the shortest code `1` is output; when the pixel of interest has the same value as color data (C.sub.2) of a pixel, which has color data different from C.sub.1, and appears latest, the second shortest code `01` is output; when the pixel of interest has the same value as color data (C.sub.3) of a pixel, which has color data different from C.sub.1 and C.sub.2, and appears latest, the third shortest code `001` is output; when the pixel of interest has color data different from C.sub.1, C.sub.2, and C.sub.3, an unused code `000` is output, and the color data at that time is output. Thus, a computer-created image is compressed at a high compression ratio without causing deterioration of image quality.