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This paper presents an adaptive block-based image coding method, which combines the advantages of variable block size transform and adaptive pre-/post-filtering scheme. Our approach partitions an image into blocks with different sizes, which are best suitable for the characteristics of the underlying data in the rate-distortion (RD) sense. The adaptive block decomposition mitigates the ringing artifacts by adopting a small block size transform in nonstationary regions, and improves the coding efficiency by using a large block size transform in homogenous regions. Moreover, pre-/post-filtering is adaptively applied along the block boundaries to improve coding efficiency and minimize blocking artifacts. Simulation results show that the proposed coder can achieve competitive objective performance as well as yield superior reconstruction visual quality, compared with the RD-optimized JPEG2000 and H.264/AVC I-frame coder.