Transcoder chip having a buffer for temporarily storing decoded macroblocks and compressed domain parameters. A video decoding module of the transcoding chip decodes and stores the decoded macroblocks in the buffer in a first sequence. The video encoding module then reads the data from the buffer in a second sequence different from the first sequence to encode the macroblocks in a different format. The buffer can also be used for deblocking the macroblocks and for filtering motion vectors. By using the buffer, data traffic between the transcoding chip and external memory is reduced, increasing the speed for transcoding a video sequence from one format to another.