In accordance with the present disclosure, there is provided a method for compensating tones on a compressed digital image data. The method comprises generating the compressed digital image from an input digital image data using a wavelet-based compression method; recovering a low resolution version of the input digital image data from the compressed digital image data by partially decompressing the compressed digital image; applying compensating tone reproduction curves (TRC) to the low resolution version of the input digital image data to generate a compensated low resolution image; re-compressing the image using the compensated low resolution image; and, subsequently decompressing all of the compensated pixel arrays to produce decompressed compensated image data.