Method, apparatus, and systems employing novel dictionary entry replacement schemes for dictionary-based high-bandwidth lossless compression. A pair of dictionaries having entries that are synchronized and encoded to support compression and decompression operations are implemented via logic at a compressor and decompressor. The compressor/decompressor logic operatives in a cooperative manner, including implementing the same dictionary update schemes, resulting in the data in the respective dictionaries being synchronized. The dictionaries are also configured with replaceable entries, and replacement policies are implemented based on matching bytes of data within sets of data being transferred over the link. Various schemes are disclosed for entry replacement, as well as a delayed dictionary update technique. The techniques support line-speed compression and decompression using parallel operations resulting in substantially no latency overhead.