Image compression is essential to handle a large volume of digital images, including computed tomographic, magnetic resonance, computed radiographic, and digitized images in a digital radiology operation. Developed during the past few years, full-frame bit allocation performed with the cosine transform technique has been proved to be an excellent irreversible image compression method. This article describes the effect, on the accuracy of diagnosis of subperiosteal resorption, of using the hardware compression module to produce hand radiographs. Receiver operating characteristic analysis of the interpretation of 71 radiographs by five observers demonstrated that there is no statistically significant difference in diagnostic accuracy between the original radiographs and compressed and reconstructed images obtained with a compression ratio as high as 20:1.