A new hybrid two-stage electrocardiogram (ECG) signal compression method based on the modified discrete cosine transform (MDCT) and discrete wavelet transform (DWT) is proposed. The ECG signal is partitioned into blocks and the MDCT is applied to each block to decorrelate the spectral information. Then, the DWT is applied to the resulting MDCT coefficients. Removing spectral redundancy is achieved by compressing the subordinate components more than the dominant components. The resulting wavelet coefficients are then thresholded and compressed using energy packing and binary-significant map coding technique for storage space saving. Experiments on ECG records from the MIT-BIH database are performed with various combinations of MDCT and wavelet filters at different transformation levels, and quantization intervals. The decompressed signals are evaluated using percentage rms error (PRD) and zero-mean rms error (PRD(1)) measures. The results showed that the proposed method provides low bit-rate and high quality of the reconstructed signal. It offers average compression ratio (CR) of 21.5 and PRD of 5.89%, which would be suitable for most monitoring and diagnoses applications. Simulation results show that the proposed method compares favourably with various state-of-the-art ECG compressors.