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An efficient algorithm for compression of dynamic time-consistent 3D meshes is presented. Such a sequence of meshes contains a large degree of temporal statistical dependencies that can be exploited for compression using DPCM. The vertex positions are predicted at the encoder from a previously decoded mesh. The difference vectors are further clustered in an octree approach. Only a representative for a cluster of difference vectors is further processed providing a significant reduction of data rate. The representatives are scaled and quantized and finally entropy coded using CABAC, the arithmetic coding technique used in H.264/MPEG4-AVC. The mesh is then reconstructed at the encoder for prediction of the next mesh. In our experiments we compare the efficiency of the proposed algorithm in terms of bit-rate and quality compared to static mesh coding and interpolator compression indicating a significant improvement in compression efficiency.