This paper presents a novel loss less compression method for video. In this work, we propose a novel method for finding motion compensated frame. This is computationally much efficient than other method reported in literature. After finding the motion compensated frame, we propose a new method for efficiently applying LS based predictor on the frames. The predictor structure uses pixels in the current frame and also in the motion compensated frame. Overall performance of the proposed method is significantly better than many competitive methods at significantly reduced computational complexity. © 2011 IEEE.