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This paper presents a new pel subsampling-based search algorithm for motion estimation. The proposed quartet-pel motion estimation (QME) search algorithm reduces the number of pels taken into account for the cost function of the matching criteria at every search position, therefore reduces the computational complexity and the required memory bandwidth. Furthermore, the proposed algorithm has a regular data flow, which in turn leads to hardware-efficient implementations. Simulation results show that QME achieves almost the same coding performance as full-search block matching algorithm (FBMA) in terms of PSNR and the size of the coded bitstream. A flexible and efficient architecture design using QME is also proposed. The flexibility is based on the configurations of processing units, such that the processing time and memory access of QME architecture can be reduced with facility. On the other hand, the efficiency of proposed hardware design, characterized by normalized processing capability per gate, also surpasses other designs.