The document discusses a proposed system for encrypting and authenticating images using data hiding. At the sender side, a palette image is encrypted using an encryption key. Data is then hidden in the encrypted image using a data hiding key. At the receiver side, the image is decrypted and the original image can be reconstructed after extracting the hidden data. The system aims to securely transfer images from sender to receiver while protecting the owner's privacy and allowing accurate recovery of the original image content. Several existing reversible data hiding and encrypted image techniques are reviewed and the proposed system is described as providing satisfactory data hiding capacity while maintaining high image quality after decryption.