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A perceptual color image coder (PCIC) is presented for the YCbCr color space within the framework of JPEG2000. This coder employs a vision model based perceptual distortion metric (PDM) to approximate perceived error for rate-distortion (R-D) optimization in order to maximize the visual quality of coded images. The vision model employed in the PCIC is structurally based on an existing monochromatic multichannel vision model, which is extended for color image coding. Subjective tests with 30 viewers show that the PCIC provides superior picture quality at low to intermediate bitrates in comparison with a JPEG2000 compliant coder employing the mean squared error (MSE) and the visual distortion metric (Cvis) as distortion measures, respectively.