A method of labeling pixels in an image is described where the pixel label is selected from a set of three or more labels. The pixel labeling problem is reduced to a sequence of binary optimizations by representing the label value for each pixel as a binary word and then optimizing the value of each bit within the word, starting with the most significant bit. Data which has been learned from one or more training images is used in the optimization to provide information about the less significant bits within the word.