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We introduce the notion of energy-scalable system-design. The principal idea is to maximize computational quality for a given energy constraint at all levels of the system hierarchy. The desirable energy-quality (E-Q) characteristics of systems are discussed. E-Q behavior of algorithms is considered and transforms that significantly improve scalability are analyzed using three distinct categories of commonly used signal-processing algorithms on the StrongARM SA-1100 processor as examples (viz., filtering, frequency domain transforms and classification). Scalability hooks in hardware are analyzed using similar examples on the Pentium III processor and a scalable programming methodology is proposed. Design techniques for true energy scalable hardware are also demonstrated using filtering as an example.