Methods of spatial compression of image data using trees formed with logic gates are described. Data encoding is achieved using a five-level wavelet transform, such as the Haar or 2/10 transforms. A dual transform engine is used, the first engine being used for the first transform, and the subsequent transforms being performed by the second engine. Each bit plane of the resulting coefficients is then encoded by forming a tree structure from the bits and logical OR combinations thereof. Redundant data are removed. Further data can be removed with a predetermined compression profile. The resulting blocks of compressed data are of variable length and are packaged with sync and index words for transmission so that the location and identity of the transformed data blocks can be determined.