An image processing apparatus that is capable of presenting a general overview of the contents of an original image from its corresponding scrambled image is disclosed. The image processing apparatus applies a discrete wavelet transform to a pixel value of each of at least one rectangular region into which image data are divided and hierarchically compresses the image data into a compressed code stream. Then the image processing apparatus performs a scrambling process on compressed code within the compressed code stream that is of a level corresponding to a high resolution image component and refrains from performing the scrambling process on compressed code other than that of the level corresponding to the high resolution image component.