A system for compressing an image. The system determines a set of commonly occurring color values in the image and associates a designator with each commonly occurring color value. For each pixel in the image, the system identifies a color value for the pixel. If the pixel has a commonly occurring color value, the system substitutes the associated designator for the commonly occurring color value. Otherwise, if the pixel does not have a commonly occurring color value, the system adds the color value to a rare color list, and substitutes a special designator for the color value to indicate that the color value for the pixel is contained in the rare color list.