In an MPEG compatible image signal processor an MPEG data stream is decoded, decompressed and recompressed before blocks of image pixel values are stored in memory. The recompression system evaluates block data to determine the range and minimum pixel values for a given image block of pixels values. These values are encoded, and the encoded representations are stored in a parameter field with the quantized data block to facilitate data reconstruction. Encoding occurs by fitting the actual range and minimum values to a predetermined set of values. Each selected predetermined value is then encoded as a three-bit index in the parameter field. Storing the encoded values with the quantized data facilitates reconstruction with minimal error. Also, encoding the values preserves memory for the quantized data.