An encoding method for encoding of images and corresponding decoding method is disclosed, as well as an encoder and a decoder. The encoding method comprises creating, in an encoder, a residual block from an original block and a prediction block which is an approximation of the original block, wherein the created residual block comprises residual block elements. The en-coding method further comprises re-ordering, in the encoder, the residual block elements within the residual block; and applying, in the encoder, a transform to the re-ordered residual block. By re-ordering the residual block elements prior to applying a transform, an improved efficiency of the encoding may be obtained.