Abstract: In this paper, a new Set Partitioning In Hierarchical Trees(SPIHT) coding algorithm is proposed, which is based on a Mixed Contourlet and Wavelet Transform(MCWT) and a new spatial orientation tree (MCWT-SPIHT). In the proposed image coding algorithm, Contourlet transform is employed for the first stage then followed by wavelet transform for the coarse scale. According to the structure properties of the MCWT coefficients, a new spatial orientation tree is developed to perform the SPIHT-like coding algorithm based on SPIHT coding idea of wavelet transform. Experimental results demonstrate that the proposed algorithm is competitive to wavelet transform, Contourlet transform and Wavelet Based Contourlet Transform(WBCT) with SPIHT in terms of Peak Signal to Noise Ratio (PSNR) at low bit rate, and it contains more contours and textures in the reconstructed images.