A system and method are described below for reducing the effects of packet loss in a video communication system. For example, one embodiment of a computer-implemented method comprises: logically subdividing each of a sequence of images of a video stream into a plurality of tiles, each of the tiles having a defined position within each of the sequence of images; and packing the tiles into a plurality of data packets to maximize the number of tiles which are aligned with boundaries of each of the data packets; and transmitting the data packets containing the tiles over a communication channel from a server to a client.