A simple, highly efficient intra prediction algorithm to reduce the computational complexity of H.264/AVC High Profile is proposed. The algorithm combines two methods. The first method is a quant-based block-size selection decision that is based on the sum of the quantization AC coefficients among intra 8 × 8 mode predictions, combined with an error adjustment to select either intra 4 × 4 or intra 16 × 16 mode predictions. The second method is a novel direction-based prediction mode decision that is used to reduce the possible prediction modes for the rate-distortion (RD) optimization technique. Our experimental results demonstrate that the proposed algorithm reduces the encoding time by approximately 54% compared with that needed for an exhaustive search using the joint model reference software. The peak signal-to-noise ratio degradation is negligible, and the bit rate increment is minimal. Furthermore, the results show that our algorithm achieves a significant improvement in both computation performance and RD performance as compared with the existing algorithms.