A method of and apparatus for compressing a stream of data, such as video data, is disclosed. First, data in the video stream are classified in accordance with their values. Data with values equal to zero are classified in a first class. Data with values less than a predetermined positive number but greater than a predetermined negative number, and not equal to zero, are classified in a second class. All other data are classified in a third class. Data in the first class is compressed using a run length encoding technique. Data in the second class is compressed by reducing the size of the data value and by adding a constant. Data in the third class is not compressed, but is modified by adding a constant. The data can be decompressed by determining the class of the compressed value and reversing the compression process. The compression method disclosed is easy to implement and results in a significant reduction in the amount of data that needs to be transmitted.