Existing approaches to background noise coding at very low bit rates (i.e., below 1 kbps) fail to reproduce the noise with natural quality, resulting in a degradation of the overall perceived quality. In this paper, we propose a novel scheme for natural-quality reduced-rate coding of background acoustic noise in voice communication systems. A better representation of the excitation signal in a noise-synthesis model is achieved by classifying the type of acoustic environment noise. Class-dependent residual substitution is used at the receive side to synthesize background noise that sounds similar to the background noise at the transmit side. The improvement in the quality of synthesized noise during speech gaps helps in preserving noise continuity between talk spurts and speech pauses, and enhances the perceived quality of a conversation.