A novel neural network based method for halftoning and inverse halftoning of digital images is presented. We first start from inverse half-toning of images produced from error diffusion methods using an RBF network plus an MLP network. The restored contone images have had good quality already. Then, an SLP neural network is used to refine the halftoning processing and the training process of the inverse half-toning network is also involved. The combined training procedure produces half-tone images and the corresponding continuous tone images at the same time. It is found that these contone images have even better PSNR performance. Furthermore, the resulted half-tone images are visually sharper and clearer, too. The proposed inverse half-toning method is also compared to the well-known LUT method.