A simple and elegant algorithm is presented to encode images with rich content, which allows easy access to various objects. An object-plane-based encoding method for compression of synthetic aperture radar (SAR) imagery is developed, with different object planes for target classes and background. A variable-rate residual vector quantization (VQ) algorithm is developed to encode the background information. This algorithm is very powerful as indicated by the experimental results. The proposed coding scheme allows compression matched to the final application of the images, which in this case is target recognition and classification.