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In this paper, we present two novel robust methods for embedding watermarks into dithered halftone images. The first method is named paired subimage matching ordered dithering (PSMOD), of which the decoder is provided with a priori information of the original watermark, and the corresponding application is copyright protection. The other method, blind paired subimage matching ordered dithering (BPSMOD), does not require the knowledge of the original watermark, and the main application is secret communication. Both methods utilize the bit and sub-subimage interleaving preprocesses. The experiments show that both techniques are sufficiently robust to guard against the cropping, tampering, and print-and-scan degradation processes, in either B/W or color dithered images. Both techniques are also sufficiently flexible for various levels of embedded capacities. Furthermore, a novel progressive coding scheme is also presented in this paper for the efficient display of dithered images. After the preprocessing of bit-interleaving, this algorithm utilizes the characteristic of reordered image to determine the transmitting order and then progressively reconstructs the dithered image. Moreover, the dithered images are further compressed by lossy and lossless procedures. The experimental results demonstrate high-quality reconstructions while maintaining low transmitted bit rates.