Image compression method and long distance transmission technology are technical difficulties in researching digital down-hole television. A down-hole image compression and transmission system is designed. Data are transmitted with quad logging cables and the data transfer rate is 100Kbps; hardware image compression method based on the wavelets transform is adopted and image data are treated with the wavelets transform, quantization and coding. By controlling color selection, quantizes coefficients, quality box parameters, background contrast and field rate to achieve dynamic control of compression rate and obtain high compression ratio simultaneously. Two compression ratio control methods are presented according to data transfer rate and typical borehole image and steady image can be observed in 3000m deep mine.