Abstract: The following paper proposes a novel scheme of data hiding in encrypted images based on lossless compression of encrypted data. In encryption phase, the original content is encrypted into images. As majority of the encrypted data is kept unchanged, the quality of the decrypted image is satisfactory. In the receiver phase, the data is successfully extracted from the image with the help of a public key. The receiver can further recover the original plaintext image without any error.

Keywords: Encryption, Decryption, lossless data