An encoding error by the encoding and the decoding of an image is controlled within a predetermined range by an image processing apparatus which includes an input unit for inputting image data, a prediction unit for predicting pixel values indicated by the image data, a generation unit for generating pixel values derived by converting the pixel values of the image data within a range of .+-.e based on the prediction result by said prediction unit and an encoding unit for encoding parameters relating to the pixel values generated by said generation unit based on the prediction result by said prediction unit. An image having a gradient in the values of block pixels is encoded at a high efficiency by an image processing apparatus which includes a division unit for dividing an image into block pixels to be encoded, a generation unit for generating parameters defining a plane based on values of first block pixels and values indicating positions of the block pixels to be encoded and a plane encoding unit for encoding difference values between the values of the block pixels indicated by the plane defined by the parameters and the values of the encoded block pixels.