This paper presents a new image compression and decompression method which combines the Block Truncation Coding technique with the Jacquin's basic automatic fractal image coding technique. A coding scheme has been designed for compression of meteorological satellite cloud pictures in the light of the characteristics of satellite imagery data. Experimental results show that the new scheme, as compared with the basic automatic fractal image coding scheme, leads to less computation time and higher compression ratio without apparent depression in quality of the reconstructed image.