A new lossless intra coding method based on sample-by-sample differential pulse code modulation (DPCM) is presented as an enhancement of the H.264/MPEG-4 AVC standard. The H.264/AVC design includes a multidirectional spatial prediction method to reduce spatial redundancy by using neighboring samples as a prediction for the samples in a block of data to be encoded. In the new lossless intra coding method, the spatial prediction is performed based on samplewise DPCM instead of in the block-based manner used in the current H.264/AVC standard, while the block structure is retained for the residual difference entropy coding process. We show that the new method, based on samplewise DPCM, does not have a major complexity penalty, despite its apparent pipeline dependencies. Experiments show that the new lossless intra coding method reduces the bit rate by approximately 12% in comparison with the lossless intra coding method previously included in the H.264/AVC standard. As a result, the new method is currently being adopted into the H.264/AVC standard in a new enhancement project.