1. A method of storing and processing halftoned raster data, comprising the steps: using a predefined dither matrix having predetermined dithering thresholds to render raster data into individual pixels of an uncompressed halftoned digital image; storing said uncompressed halftoned digital image in a local memory; using the predetermined dithering thresholds to losslessly compress a selected two-dimensional portion of the stored uncompressed halftoned image; and replacing said stored uncompressed halftoned image portion in said local memory with a corresponding compressed halftoned image portion.