I will start with a question “why signal can be compressed?”. I will then describe quantization, entropy-coding, difference-PCM, and Discrete Cosine Transform (DCT). My main motive will be to illustrate the basic principle rather than to describe the details of each method. Finally I will discuss how these various algorithm combined to get the JPEG standard for image compression. Time permitting, I will comment on various famous theories which lead to JPEG standard.