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Reversible data embedding is a very important issue, especially in dealing with sensitive images such as military data and medical data. Based on the edge-directed prediction scheme, the authors propose a reversible data-embedding scheme to embed secret information in original images. In the proposed scheme, an embedded pixel value is generalised according to a predetermined threshold and the difference between the predicted pixel value and its original pixel value. Experimental results show that the proposed scheme can provide great payload capacity while preserving the quality of the stego-image. The hiding capacity of the proposed scheme is about 1.7 times that of Tian's data-embedding scheme and twice that of Celik's.