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This paper addresses the problem of streaming packetized media over a lossy packet network in a rate-distortion optimized way. We show that although the data units in a media presentation generally depend on each other according to a directed acyclic graph, the problem of rate-distortion optimized streaming of an entire presentation can be reduced to the problem of error-cost optimized transmission of an isolated data unit. We show how to solve the latter problem in a variety of scenarios, including the important common scenario of sender-driven streaming with feedback over a best-effort network, which we couch in the framework of Markov decision processes. We derive a fast practical algorithm for nearly optimal streaming in this scenario, and we derive a general purpose iterative descent algorithm for locally optimal streaming in arbitrary scenarios. Experimental results show that systems based on our algorithms have steady-state gains of 2-6 dB or more over systems that are not rate-distortion optimized. Furthermore, our systems essentially achieve the best possible performance: the operational distortion-rate function of the source at the capacity of the packet erasure channel.