Transmission of compressed video over packet networks with nonreliable transport benefits when packet loss resilience is incorporated into the video coding. One promising approach to packet loss resilience, particularly for transmission over networks offering dual priorities such as asynchronous transfer mode (ATM) networks, is based on layered coding which uses at least two bitstreams to encode video. The base-layer bitstream, which can be decoded independently to produce a lower quality picture, is transmitted over a high priority channel. The enhancement-layer bitstream(s) contain less important information, so that packet losses are more easily tolerated. The MPEG-2 International Standard provides four methods to produce a layered video bitstream: data partitioning, signal-to-noise ratio scalability, spatial scalability, and temporal scalability. Each of these techniques was included in the standard in part for motivations other than loss resilience. This paper compares the performance of these techniques (excluding temporal scalability) under various loss rates using realistic length video material and discusses their relative merits taking implementation issues into consideration. Nonlayered MPEG-2 coding gives generally unacceptable video quality for packet loss ratios of 10-3 for small (single ATM cell) packet sizes. Better performance can be obtained using layered coding and dual-priority transmission. With data partitioning, the simplest to implement among the three, cell loss ratios of 10-4 in the low-priority layer are definitely acceptable, while for SNR scalable encoding, cell loss ratios of 10-3 are generally invisible, even to experienced viewers. Spatial scalable encoding can provide even better visual quality under packet losses; however, it has a high implementation complexity. © 1996 IEEE.