The aim of the project is to develop an ECG signal compression algorithm that has a high compression ratio while guaranteeing signal quality. An electrocardiography (ECG) signal is a representation of cardiac activity and has an need to be compressed to reduce data storage requirements and energy cost of transmission. Previous ECG signal compression techniques have shown steady improvement on compression ratio. However, these techniques generally lack quality considerations, so their applications are limited. We present a discrete cosine transform (DCT) based compression scheme and use beat detection which considerably improve the compression ratio. The quality of the compressed signal is configurable, and the accuracy of the signal is maintained given a signal quality requirement. The algorithm is implemented in a software/hardware solution. Some parts need to be done in the software. As a proof of concept, we have chosen the filter to be implemented in hardware. Mathworks HDL coder was used for generating RTL code and testbenches. Results show that our algorithm is capable of maintaining the specified quality, has a better compression ratio compared to previous work and is also capable to compress noisy ECG signals.