Size reduction through compression is an important issue that needs to be investigated for possible effects on image quality. The aim of the present study was to evaluate the subjective image quality of digital panoramic radiographs which were lossless and lossy compressed for the visualization of various anatomical structures. Fifty-five digital panoramic radiographs in Tagged Image File Format (Tiff) were used in the study. Two types of lossy (Joint Photographic Experts Group (Jpeg)) and one type of lossless (Lempel-Ziv-Welch) compression were applied to the original radiographs. These radiographs were evaluated by two observers separately for the visibility of some anatomical structures with visual grading. Mean quality number for each radiograph was obtained. The differences between the mean quality numbers in each compression and original image mode were evaluated with Friedman test. Pair-wise comparisons revealed that there were statistically significant differences between all groups (p = 0.000) for all comparisons except for Jpeg_1 and Jpeg_2 groups. Kappa statistics was used to evaluate inter- and intra-observer agreements. Intra-observer agreements were ranging from 0.229 to 1.000 and inter-observer agreements were ranging from 0.154 to 1.000. The observers had better inter- and intra-observer agreements in highly compressed Jpeg_1 images. The anatomical structures evaluated in this study had better visibility in Tiff images than Jpeg images except for mandibular canal and mental foramen. While Jpeg compressed images offer high inter- and intra-observer agreements, the visibility of anatomical structures are better in Tiff images except for mandibular canal and mental foramen. © 2011 Springer-Verlag.