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The lifting scheme is well known to be an efficient tool for constructing second generation wavelets and is often used to design a class of bi-orthogonal wavelet filter banks. This paper presents the implementation of a class of Infinite Impulse Response (IIR) orthogonal wavelet filter banks by using the adaptive lifting scheme with two lifting steps. A class of II R orthogonal wavelet filter banks can be realized by using all pass filters in the lifting steps. The adaptive lifting scheme is based on the statistical characteristics of the image, the order of the prediction and updation filters are chosen by considering the statistical energy of the image. The designed IIR orthogonal wavelet filter banks have approximately linear phase responses. Finally, the proposed IIR orthogonal wavelet filter banks are applied to the image compression and the coding performance of the proposed IIR filter banks are analysed.