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In this paper, we propose a new deinterlacing algorithm, which uses directional interpolation and motion compensation. In the proposed method, intrafield interpolation is first performed in the direction that shows the highest correlation. Second, motion estimation is performed between two fields of the same parity. The motion vector is further refined in half-pixel accuracy. In the conventional motion compensated methods, a prefilter such as line averaging, is applied to interpolate missing lines prior to motion estimation between opposite parity fields. The proposed method does not require this prefilter since block matching is performed between the same parity fields. Finally, we apply a test and use either directional interpolation or motion compensated interpolation depending on the test result. Experimental results demonstrate that the proposed method provides better performances than conventional deinterlacing algorithms.