In this research, two video compression schemes have been established and their performance have been investigates. In the first scheme the video frames have been handled either as reference frames or predicted frames, while in the second scheme the video frames are considered either as reference, interpolative, or predictive frames. The reference frames are coded by using intra-frame coding method that based on wavelet transform. A low complexity coding process was adopted to handle the intra-frame coding. The predictive frames are coded by using inter-frame coding method that based on block motion estimation (specifically, Once at a Time Search (OTS) method). The interpolative frames are coded by using the linear interpolation methods, where the nearest surrounding reference frames are used to construct the interpolated frame. The differences between the pixels values of the interpolative frame and the corresponding interpolation values are coded by using the intra-frame coding. Beside to the wavelet transform other coding steps (like, hierarchal uniform quantization, Differential Pulse Code Modulation (DPCM), shift coding) have been utilized to gain more compression.In this research enhance method of motion estimation was implemented to encode the predicted frames, this method was called modified OTS (MOTS) method.The test results indicated that MOTS method give high compression ratio and good fidelity measures (MSE and PSNR) and better than those obtained from OTS, and this method faster than OTS method. Also the test results showed that when using the interpolated frames the fidelity measures become well especially when the size of the group of frames is large.
