The goal of data hiding techniques usually considers two issues, embedding capacity and image quality. Consequently, in order to achieve high embedding capacity and good image quality, a data hiding scheme combining run-length encoding (RLE) with multi-bit embedding is proposed in this paper. This work has three major contributions. First, the embedding capacity is increased 62% because the secret message is compressed before embedding into the cover image. Secondly, the proposed scheme keeps the multi-bit generalized exploiting modification direction (MGEMD) characteristics, which are effective to reduce modified pixels in the cover image and to maintain good stego image quality. Finally, the proposed scheme can prevent modern steganalysis methods, such as RS steganalysis and SPAM (subtractive pixel adjacency matrix), and is compared to MiPOD (minimizing the power of the optimal detector) scheme. From our simulation results and security discussions, we have the following results: First, there are no perceivable differences between the cover images and stego images from human inspection. For example, the average PSNR of stego images is about 44.61 dB when the secret message (80,000 bits) is embedded for test cover images (such as airplane, baboon, Lena) of size 512×512. Secondly, Appl. Sci. 2015, 5 1034 on average, 222,087 pixels were not modified after embedding for the cover image. That is to say, 12% less pixels are modified as compared to the MGEMD method. From the performance discussions, the proposed scheme achieves high embedding capacity and good image quality, but also maintains stego image security.