This grant provides support to Prof. Nariman Farvardin under the Foundation's Presidential Young Investigator (PYI) program. His research currently centers on the design and analysis of efficient and easily instrumentable data compression schemes for application to real- world sources. This work spans the range from stochastic modeling through detailed bounding and analysis, all the way to complexity analysis and VLSI design. The PYI Awards program provides research support to the Nation's most outstanding and promising young science and engineering faculty. The awards are intended to improve the capability of U. S. academic institutions to respond to the demand for highly qualified science and engineering personnel for academic and industrial research and engineering. This PYI has made significant contributions to his field of engineering and has potential to become a leader in academic research and education. The diary note describes the rigorous selection procedure. A grant award is highly recommended. Dr. Farvardin has obtained the maximum matching funds, so an award of $62500 is thus recommended.