This document compares DCT and wavelet transform based image compression algorithms. It finds that wavelet transforms provide better compression ratios and lower mean square errors than DCT. As the level of the wavelet transform increases, the compression ratio increases while the mean square error initially decreases for wavelet levels 1-3. While DCT has faster encoding, it produces blocking artifacts, whereas wavelet transforms maintain good visual quality at higher compression ratios by considering correlations across blocks. Overall, the study shows that wavelet transforms enable higher compression with better visual quality than DCT.