A method is disclosed herein for compressing spectral data corresponding to an image comprising a plurality of pixels. The method includes the step of creating a set of potential endmembers. A first plurality of the potential endmembers are identified as a first set of endmembers based upon their respective correlations with a first spectral signature of a first of the plurality of pixels. The first pixel is then represented as a combination of the first set of endmembers. Processing of the image preferably continues by identifying a second plurality of the potential endmembers as a second set of endmembers based upon their respective correlations with a second spectral signature of a second of the plurality of pixels. The second pixel is then represented as a combination of the second set of endmembers.