In this paper, we propose a hybrid image coding system for encoding images at bit-rates below 0.5 bpp. The hybrid coder is a combination of conventional discrete cosine transform (DCT) based coding and code-excited linear predictive coding (CELP). The DCT-based component allows the efficient coding of edge areas and strong textures in the image which are the areas where CELP based coders fail. On the other hand, CELP coding is used to code smooth areas which constitute the majority of a typical image, to be encoded efficiently and relatively free of artifacts.