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An improved decoding algorithm based on joint bitplane decoding for distributed video coding is proposed. The new algorithm uses the decoded bitplane results of quantization coefficients as prior knowledge, and decodes the other bit-planes to avoid correlation weakening between sources when decoding bit-planes independently. It makes full use of correlation between Wyner-Ziv frames and key frames; therefore the rate-distortion performance of distributed video coding can be enhanced without increasing decoding complexity. Simulations indicate that, compared with the independent bit-planes decoding system, the proposed algorithm can achieve 13% to 16% bit-rate saving under the same condition, and performance improves more apparently with the increase of quantization levels.