Certain aspects of a method and system for motion-compensated picture rate up-conversion (PRUC) of digital video using picture boundary processing may include generating one or more forward motion vectors and one or more backward motion vectors based on extracted picture rate up-conversion (PRUC) data. A cost of performing motion estimation of a particular block along the generated forward motion vectors and the generated backward motion vectors corresponding to the particular block may be calculated. The particular block may be a boundary block. A motion vector with the least cost may be selected and motion compensated to generate a plurality of interpolated pictures.