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In this paper, a new complexity-reduced method and its hardware architecture for motion estimation and the in-loop filter for MPEG-4 AVC/H.264 is proposed. The proposed method is focused on the computation reduction for the motion search algorithm among multiple reference frames and the mode partition determination. Furthermore, to verify the functionality and performance of the proposed hardware design, an emulation board platform, the ARM Integrator, is used for H.264 hardware/software co-development. The experimental results show that the proposed method has excellent performance with little or no degradation of coding efficiency.