In a rate control system, an MMU temporarily stores in a mass storage an input bit stream including compressed and encoded data which is compressed and encoded according to the JPEG2000 standard. The MMU then reads out data from the mass storage and outputs it to a multiplexer according to readout control signals. The multiplexer multiplexes the data and outputs the result as an output bit stream. A bit truncation controller comprises an image quality controller for selecting a target to be coded according to target image quality; and a rate controller for controlling a rate according to a target rate. A layer splitting controller outputs to the MMU the readout control signal for generating an output bit stream which is divided into a plurality of layers.