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In this paper we discuss an algorithm for real time transmission of moving color images on the TCP/IP network using wavelet transform and neural network. The image frames received from the camera are two-level wavelet transformed in the server, and are transmitted to the client on the network. Then, the client performs the inverse wavelet-transform using only the received pieces of each image frame within the prescribed time limit to display the moving images. When the TCP/IP network is busy, only a fraction of each image frame is delivered. When the line is free, the whole frame of each image is transferred to the client. The receiver warns the sender of the condition of traffic congestion in the network by sending a special short frame for this specific purpose. The sender can respond to this information of warning by simply reducing the data rate which is adjusted by a back-propagation neural network. In this way we can send a stream of moving images by adaptively adjusting to the network traffic condition.