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This paper presents a data hiding scheme that hides the data in the compression domain of a digital image. The pattern-based compression algorithm used for hiding the information, compresses the image according to the visual activity of individual image blocks. The key point of the proposed scheme is to first identify the smooth area of the host image and then embed the data in these areas. Experimental results confirm that the proposed scheme can embed a large amount of data in the compressed file while maintaining satisfactory image quality.