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Many image recognition algorithms based on data-learning perform dimensionality reduction before the actual learning and classification because the high dimensionality of raw imagery would require enormous training sets to achieve satisfactory performance. A potential problem with this approach is that most dimensionality reduction techniques, such as principal component analysis (PCA), seek to maximize the representation of data variation into a small number of PCA components, without considering interclass discriminability. This paper presents a neural-network-based transformation that simultaneously seeks to provide dimensionality reduction and a high degree of discriminability by combining together the learning mechanism of a neural-network-based PCA and a backpropagation learning algorithm. The joint discrimination-compression algorithm is applied to infrared imagery to detect military vehicles.