The QM-Coder based on the recommandation of the JBIG committee has been studied for applying it to G3 FAX. In the point of view of implementation. the QM-Coder is modified to have following properties : 1) initialized at each start of the new line for protecting the error propagation, 2) pixel context for error estimation, fill bit insertion to meet minimum scan line time of 10 msec. and it is found that the modified QM-Coder is useful for encoding half tone images for low end G3 FAX machine, For higher compression ration than QM-Coder in encoding of the image binarized by ordered orther thchniques, a rearranging process before applying the QM-Coder is used and the resultant compression ratic was increased 1.13∼1.31 times than that of the conventional QM-Coder.