An analog-to-digital converter (ADC) having a reduced number of quantizer output levels provides for reduced complexity and power consumption along with improved linearity. The analog-to-digital converter includes a loop filter, a quantizer for quantizing the output of the loop filter and a digital integrator for integrating the output of the quantizer. A difference circuit is included in the converter that produces a signal proportional to the difference between the present value and a previous value of the digital integrator output and provides feedback to the loop filter. The number of levels of the quantizer output is thereby reduced with respect to the modulator output, since the quantizer is operating on a feedback signal that represents changes in the output of the converter modulator rather than the modulator output itself.