Colour quantization is an established method for the reproduction of high visual quality colour imagery on systems with limited frame buffer resources. The ever increasing demand for fast and image/graphic intensive applications for cheap desktop platforms has called for greater savings in display and storage resources and simple, easy to implement architectures. Because human visual information system processes visual information over specific frequency ranges, it is possible to compress colour quantized image further by exploiting spatial visual redundancies. This paper presents a technique which reduces the frame buffer requirements of colour quantized images and at the same time maintains the visual quality of the images. The method has a simple hardware architecture and can be easily implemented using existing technology. Computer simulation results are presented to illustrate the effectiveness of the method.