Abstract— Color Coded Cryptography. Data encryption technique converts data into a unreadable format so as to protect the information from external intrusion. It is thus useful in ensuring the privacy and security of the < Final Year Projects 2016 > information transferred or shared between the systems. Text compression algorithms can be used to compact the text stored in the file and reduce the size of the file. It helps to reduce the consumption of resources, such as hard disk space or transmission bandwidth. Here, we propose a color coding scheme that can be used for data encryption which represents text in the form of colored blocks by grouping together binary bits and assigning them colors along with Huffman encoding scheme which is used for lossless text compression.