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Smart Huffman Compression is a software appliance designed to compress a file in a better way. By functioning as an JSP, it provides high level abstraction of java Servlet. For example, Smart Huffman Compression encodes the digital information using fewer bits, reduces the size of file without loss of data in a single, easy-to-manage software appliance form factor. It also provides us the decompression facility also. Smart Huffman Compression provides our organization with effective solutions to reduce the file size or lossless compression of data. It also expedites security of data using the encoding functionality. It is necessary to analyze the relationship between different methods and put them into a framework to better understand and better exploit the possibilities that compression provides us image compression, data compression, audio compression, video compression etc.