1. A system for encoding a digital image of the type in which each pixel of the image is defined by a multiple bit value, including: a loading module for identifying a grouping of pixels within said digital image; an encoding module for identifying the type of data contained within said grouping as either bilevel data or multilevel data, and coding said grouping to indicate the type of data so identified and the pixel values such that, for bilevel data, the pixels of the grouping are encoded by means of a single bit value and, for multilevel data, the individual value of at least one pixel of the grouping is encoded by means of a multi-level value represented by multiple bits wherein said encoding module further divides said grouping into a plurality of subgroupings, and codes each subgrouping separately depending on the type of data contained within said subgrouping; and an output for outputting the encoded image grouping.