Image compression is the application of Data compression on digital images. A fundamental change in the image compression approach came after the Discrete Wavelet Transform (DWT) became popular. To overcome the inadequacies in the JPEG standard and serve developing areas of mobile and Internet communications. An image compression algorithm was known using MATLAB code,and modified to perform better when implemented in hardware description language. Using SPIHT in Verilog HDL, the encoder for the image compression employing DWT was implemented. The encoding technique exploits the zero tree structure present in the bit planes to compress the transform coefficients. In this work, the design of Lossy 3-D DWT (Discrete Wavelet Transform)using Lifting Scheme Architecture will be modeled using the Verilog HDL and its functionality were verified using the Model SIM tool and can be synthesized using the Xilinx tool.