In this paper, we propose a novel reversible steganographic technique to embed secret data into digital images compressed using vector quantization (VQ). The proposed method is based on joint neighboring and predictive coding. The proposed technique can embed n secret bits into one VQ index, where n=1, 2, 3, and 4. Our method uses left and upper neighboring VQ indexes and the difference between the current VQ index and the predicted value produced by the median edge detector predictor to achieve a low bit rate. The experimental results show that the proposed approach obtains embedding rates of 1, 2, 3, and 4 bits per index (bpi) with respective average bit rates of 0.409, 0.471, 0.534, and 0.596 bit per pixel (bpp) for a 256 sized codebook. This confirms that the proposed scheme outperforms three similar reversible data hiding schemes in VQ-compressed domain.