Dermatologists were shown digitized images of skin lesions compressed by Joint Photographic Expert Group (JPEG) and fractal image format (FIF) algorithms and asked to make a diagnostic assessment and rate the image quality in displaying the features necessary for that assessment. Dermatologists performance in the diagnostic assessment was not affected by the level of compression (up to 40X) using either algorithm, but ratings of image quality for all compressed images were significantly lower than for uncompressed images and for the original photographic slides. There were no significant differences in dermatologists' performance or ratings between the two compression algorithms.