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In this paper we present a state of the art, practical, realtime, region of interest (ROI) video encoder implemented on the Texas Instruments TMS320DM3x SOC. The proposed algorithm is a novel rate distortion optimized ROI coding algorithm with low complexity making it ideal for implementing on embedded video SOCs with low computational and memory resources while achieving excellent perceptual quality. The proposed solution is a complete solution incorporating ROI processing in the entire video chain from front-end face detection to back-end video compression. It is probably one of the first video capture and compression system implemented on an embedded SOC which relies on specialized rate distortion method for ROI coding using object detection methods from the front end or user inputs. Extensive subjective evaluation has been performed on the proposed algorithm for various resolutions ranging from CIF to 1080p video resolutions at different bitrates for over 300 test cases. Significant subjective quality enhancements have been observed for video sequences over all the different video resolutions at various different bitrates. With the proposed algorithm competitive subjective quality is achieved for video conferencing sequences at 300 kbps for 720p and at 96 kbps for CIF when compared to the case where no ROI based rate distortion methods for coding are used. On the Texas Instruments TMS320DM3x SOC the ROI videoencoder achieved realtime performance for 1080p video resolution at 30 fps.