A method and apparatus for processing halftone digital image data to generate a corresponding continuous tone image is disclosed. More specifically, the present invention discloses a method and apparatus for filtering a halftone image in two directions which enables images to be smoothed in the flat regions, while reducing smoothing along edges of the image and eliminating smoothing altogether in the ridges and valleys. This provides for a significant improvement in image quality without losing the fine details that are often lost using standard filtering techniques.