A method and a system for spatial scalable region of interest transcoding of JPEG2000 coded video frames for video surveillance systems. Based on a user defined ROI, the method transcodes HD frames into images in moderate resolution with a ROI in HD resolution. The transcoder extracts all packets belonging to the ROI or the lower resolution levels of the background from the JPEG2000 bitstream. Non-ROI packets of higher resolution levels are replaced by empty packets. The ROI is tracked using a mean shift algorithm to guarantee that always the correct image details are extracted in high resolution. Since the transcoding is performed by extracting and replacing packets of the codestream, an expensive re-encoding of the code-stream is not required. Thus, the transcoding technique is of low complexity and shows a short processing time. Combining the transcoding technique with mean shift tracking leads to a powerful video transcoding technique.