diff --git a/Makefile.in b/Makefile.in
index e7cabdf..f485b81 100644
--- a/Makefile.in
+++ b/Makefile.in
@@ -67,6 +67,10 @@ LZPSRCS = lzp/lzp.c
 LZPHDRS = lzp/lzp.h
 LZPOBJS = $(LZPSRCS:.c=.o)
 
+DELTA2SRCS = delta2/delta2.c
+DELTA2HDRS = delta2/delta2.h
+DELTA2OBJS = $(DELTA2SRCS:.c=.o)
+
 SKEIN_BLOCK_C = crypto/skein/skein_block.c
 SKEIN_BLOCK_ASM = crypto/skein/skein_block_x64.s
 SKEIN_BLOCK_SRC = @SKEIN_BLOCK@
@@ -108,8 +112,8 @@ COMMON_LOOP_OPTFLAGS = $(VEC_FLAGS) -floop-interchange -floop-block
 LDLIBS = -ldl -L@LIBBZ2_DIR@ -lbz2 -L@LIBZ_DIR@ -lz -lm @LIBBSCLFLAGS@ \
 	-L@OPENSSL_LIBDIR@ -lcrypto -lrt
 OBJS = $(MAINOBJS) $(LZMAOBJS) $(PPMDOBJS) $(LZFXOBJS) $(LZ4OBJS) $(CRCOBJS) \
-$(RABINOBJS) $(BSDIFFOBJS) $(LZPOBJS) @LIBBSCWRAPOBJ@ $(SKEINOBJS) $(SKEIN_BLOCK_OBJ) \
-@SHA256ASM_OBJS@ @SHA256_OBJS@
+$(RABINOBJS) $(BSDIFFOBJS) $(LZPOBJS) $(DELTA2OBJS) @LIBBSCWRAPOBJ@ $(SKEINOBJS) \
+$(SKEIN_BLOCK_OBJ) @SHA256ASM_OBJS@ @SHA256_OBJS@
 
 DEBUG_LINK = g++ -m64 -pthread -msse3 @LIBBSCGEN_OPT@
 DEBUG_COMPILE = gcc -m64 -g -msse3 -c
@@ -168,6 +172,9 @@ $(LZ4OBJS): $(LZ4SRCS) $(LZ4HDRS)
 $(LZPOBJS): $(LZPSRCS) $(LZPHDRS)
 	$(COMPILE) $(GEN_OPT) $(VEC_FLAGS) $(CPPFLAGS) $(@:.o=.c) -o $@
 
+$(DELTA2OBJS): $(DELTA2SRCS) $(DELTA2HDRS)
+	$(COMPILE) $(GEN_OPT) $(VEC_FLAGS) $(CPPFLAGS) $(@:.o=.c) -o $@
+
 $(SKEIN_BLOCK_OBJ): $(SKEIN_BLOCK_SRC)
 	$(COMPILE) $(GEN_OPT) $(VEC_FLAGS) $(CPPFLAGS) $(SKEIN_BLOCK_SRC) -o $@
 
diff --git a/adaptive_compress.c b/adaptive_compress.c
index 836da25..c492f4f 100644
--- a/adaptive_compress.c
+++ b/adaptive_compress.c
@@ -95,6 +95,12 @@ adapt_stats(int show)
 	ppmd_count = 0;
 }
 
+void
+adapt_props(algo_props_t *data, int level, ssize_t chunksize)
+{
+	data->delta2_stride = 200;
+}
+
 int
 adapt_init(void **data, int *level, int nthreads, ssize_t chunksize,
 	   int file_version, compress_op_t op)
diff --git a/bzip2_compress.c b/bzip2_compress.c
index 7250f43..711019f 100644
--- a/bzip2_compress.c
+++ b/bzip2_compress.c
@@ -48,6 +48,11 @@ bzip2_stats(int show)
 {
 }
 
+void
+bzip2_props(algo_props_t *data, int level, ssize_t chunksize) {
+	data->delta2_stride = 200;
+}
+
 int
 bzip2_init(void **data, int *level, int nthreads, ssize_t chunksize,
 	   int file_version, compress_op_t op)
diff --git a/libbsc_compress.c b/libbsc_compress.c
index 4eab4c9..a3babf2 100644
--- a/libbsc_compress.c
+++ b/libbsc_compress.c
@@ -79,6 +79,7 @@ libbsc_props(algo_props_t *data, int level, ssize_t chunksize) {
 	data->buf_extra = 0;
 	data->c_max_threads = 8;
 	data->d_max_threads = 8;
+	data->delta2_stride = 150;
 }
 
 int
diff --git a/lz4_compress.c b/lz4_compress.c
index afc73ce..2db9f7c 100644
--- a/lz4_compress.c
+++ b/lz4_compress.c
@@ -56,6 +56,7 @@ lz4_props(algo_props_t *data, int level, ssize_t chunksize) {
 	data->compress_mt_capable = 0;
 	data->decompress_mt_capable = 0;
 	data->buf_extra = lz4_buf_extra(chunksize);
+	data->delta2_stride = 50;
 }
 
 int
diff --git a/lzfx_compress.c b/lzfx_compress.c
index 2bc4826..2dc3a1d 100644
--- a/lzfx_compress.c
+++ b/lzfx_compress.c
@@ -39,6 +39,11 @@ lz_fx_stats(int show)
 {
 }
 
+void
+lz_fx_props(algo_props_t *data, int level, ssize_t chunksize) {
+	data->delta2_stride = 50;
+}
+
 int
 lz_fx_init(void **data, int *level, int nthreads, ssize_t chunksize,
 	   int file_version, compress_op_t op)
diff --git a/lzma_compress.c b/lzma_compress.c
index 2221dc1..ba36b81 100644
--- a/lzma_compress.c
+++ b/lzma_compress.c
@@ -52,6 +52,7 @@ lzma_mt_props(algo_props_t *data, int level, ssize_t chunksize) {
 	data->decompress_mt_capable = 0;
 	data->buf_extra = 0;
 	data->c_max_threads = 2;
+	data->delta2_stride = 150;
 }
 
 void
@@ -59,6 +60,7 @@ lzma_props(algo_props_t *data, int level, ssize_t chunksize) {
 	data->compress_mt_capable = 0;
 	data->decompress_mt_capable = 0;
 	data->buf_extra = 0;
+	data->delta2_stride = 150;
 }
 
 /*
diff --git a/main.c b/main.c
index 7da3a0e..01d0acf 100644
--- a/main.c
+++ b/main.c
@@ -80,6 +80,7 @@ static int hide_mem_stats = 1;
 static int hide_cmp_stats = 1;
 static int enable_rabin_scan = 0;
 static int enable_delta_encode = 0;
+static int enable_delta2_encode = 0;
 static int enable_rabin_split = 1;
 static int enable_fixed_scan = 0;
 static int lzp_preprocess = 0;
@@ -148,6 +149,8 @@ usage(void)
 	    "7) Other flags:\n"
 	    "   '-L'    - Enable LZP pre-compression. This improves compression ratio of all\n"
 	    "             algorithms with some extra CPU and very low RAM overhead.\n"
+	    "   '-P'    - Enable Adaptive Delta Encoding. This implies '-L' as well. It improves\n"
+	    "             compresion ratio further at the cost of more CPU overhead.\n"
 	    "   '-S' <cksum>\n"
 	    "           - Specify chunk checksum to use: CRC64, SKEIN256, SKEIN512, SHA256 and\n"
 	    "             SHA512. Default one is SKEIN256.\n"
@@ -188,7 +191,7 @@ show_compression_stats(uint64_t chunksize)
  */
 int
 preproc_compress(compress_func_ptr cmp_func, void *src, size_t srclen, void *dst,
-	size_t *dstlen, int level, uchar_t chdr, void *data)
+	size_t *dstlen, int level, uchar_t chdr, void *data, algo_props_t *props)
 {
 	uchar_t *dest = (uchar_t *)dst, type = 0;
 	ssize_t result, _dstlen;
@@ -210,11 +213,14 @@ preproc_compress(compress_func_ptr cmp_func, void *src, size_t srclen, void *dst
 		return (-1);
 	}
 
-	_dstlen = srclen;
-	result = delta2_encode(src, srclen, dst, &_dstlen, 150);
-	if (result != -1) {
-		memcpy(src, dst, _dstlen);
-		srclen = _dstlen;
+	if (enable_delta2_encode && props->delta2_stride > 0) {
+		_dstlen = srclen;
+		result = delta2_encode(src, srclen, dst, &_dstlen, props->delta2_stride);
+		if (result != -1) {
+			memcpy(src, dst, _dstlen);
+			srclen = _dstlen;
+			type |= PREPROC_TYPE_DELTA2;
+		}
 	}
 
 	*dest = type;
@@ -225,15 +231,17 @@ preproc_compress(compress_func_ptr cmp_func, void *src, size_t srclen, void *dst
 		*dest |= PREPROC_COMPRESSED;
 		*dstlen = _dstlen + 9;
 	} else {
-		result = -1;
+		memcpy(dest+1, src, srclen);
+		*dstlen = srclen + 1;
+		result = 0;
 	}
-	result = 0;
+
 	return (result);
 }
 
 int
 preproc_decompress(compress_func_ptr dec_func, void *src, size_t srclen, void *dst,
-	size_t *dstlen, int level, uchar_t chdr, void *data)
+	size_t *dstlen, int level, uchar_t chdr, void *data, algo_props_t *props)
 {
 	uchar_t *sorc = (uchar_t *)src, type;
 	ssize_t result;
@@ -252,12 +260,14 @@ preproc_decompress(compress_func_ptr dec_func, void *src, size_t srclen, void *d
 		srclen = *dstlen;
 	}
 
-	result = delta2_decode(src, srclen, dst, &_dstlen);
-	if (result != -1) {
-		memcpy(src, dst, _dstlen);
-		srclen = _dstlen;
-	} else {
-		return (result);
+	if (type & PREPROC_TYPE_DELTA2) {
+		result = delta2_decode(src, srclen, dst, &_dstlen);
+		if (result != -1) {
+			memcpy(src, dst, _dstlen);
+			srclen = _dstlen;
+		} else {
+			return (result);
+		}
 	}
 
 	if (type & PREPROC_TYPE_LZP) {
@@ -423,7 +433,7 @@ redo:
 		if (HDR & COMPRESSED) {
 			if (HDR & CHUNK_FLAG_PREPROC) {
 				rv = preproc_decompress(tdat->decompress, cmpbuf, dedupe_data_sz_cmp,
-				    ubuf, &_chunksize, tdat->level, HDR, tdat->data);
+				    ubuf, &_chunksize, tdat->level, HDR, tdat->data, tdat->props);
 			} else {
 				rv = tdat->decompress(cmpbuf, dedupe_data_sz_cmp, ubuf, &_chunksize,
 				    tdat->level, HDR, tdat->data);
@@ -452,7 +462,8 @@ redo:
 		if (HDR & COMPRESSED) {
 			if (HDR & CHUNK_FLAG_PREPROC) {
 				rv = preproc_decompress(tdat->decompress, cseg, tdat->len_cmp,
-				    tdat->uncompressed_chunk, &_chunksize, tdat->level, HDR, tdat->data);
+				    tdat->uncompressed_chunk, &_chunksize, tdat->level, HDR, tdat->data,
+				    tdat->props);
 			} else {
 				rv = tdat->decompress(cseg, tdat->len_cmp, tdat->uncompressed_chunk,
 				    &_chunksize, tdat->level, HDR, tdat->data);
@@ -875,6 +886,7 @@ start_decompress(const char *filename, const char *to_filename)
 		tdat->cancel = 0;
 		tdat->level = level;
 		tdat->data = NULL;
+		tdat->props = &props;
 		sem_init(&(tdat->start_sem), 0, 0);
 		sem_init(&(tdat->cmp_done_sem), 0, 0);
 		sem_init(&(tdat->write_done_sem), 0, 1);
@@ -1155,7 +1167,7 @@ redo:
 				rv = preproc_compress(tdat->compress,
 				    tdat->uncompressed_chunk + dedupe_index_sz,
 				    _chunksize, compressed_chunk + index_size_cmp, &_chunksize,
-				    tdat->level, 0, tdat->data);
+				    tdat->level, 0, tdat->data, tdat->props);
 			} else {
 				rv = tdat->compress(tdat->uncompressed_chunk + dedupe_index_sz,
 				    _chunksize, compressed_chunk + index_size_cmp, &_chunksize,
@@ -1185,7 +1197,8 @@ plain_compress:
 		if (lzp_preprocess) {
 			rv = preproc_compress(tdat->compress,
 			    tdat->uncompressed_chunk, tdat->rbytes,
-			    compressed_chunk, &_chunksize, tdat->level, 0, tdat->data);
+			    compressed_chunk, &_chunksize, tdat->level, 0, tdat->data,
+			    tdat->props);
 		} else {
 			rv = tdat->compress(tdat->uncompressed_chunk, tdat->rbytes,
 			    compressed_chunk, &_chunksize, tdat->level, 0, tdat->data);
@@ -1575,6 +1588,7 @@ start_compress(const char *filename, uint64_t chunksize, int level)
 		tdat->cancel = 0;
 		tdat->level = level;
 		tdat->data = NULL;
+		tdat->props = &props;
 		sem_init(&(tdat->start_sem), 0, 0);
 		sem_init(&(tdat->cmp_done_sem), 0, 0);
 		sem_init(&(tdat->write_done_sem), 0, 1);
@@ -1927,6 +1941,7 @@ init_algo(const char *algo, int bail)
 		_init_func = zlib_init;
 		_deinit_func = zlib_deinit;
 		_stats_func = zlib_stats;
+		_props_func = zlib_props;
 		rv = 0;
 
 	} else if (memcmp(algorithm, "lzmaMt", 6) == 0) {
@@ -1953,6 +1968,7 @@ init_algo(const char *algo, int bail)
 		_init_func = bzip2_init;
 		_deinit_func = NULL;
 		_stats_func = bzip2_stats;
+		_props_func = bzip2_props;
 		rv = 0;
 
 	} else if (memcmp(algorithm, "ppmd", 4) == 0) {
@@ -1961,6 +1977,7 @@ init_algo(const char *algo, int bail)
 		_init_func = ppmd_init;
 		_deinit_func = ppmd_deinit;
 		_stats_func = ppmd_stats;
+		_props_func = ppmd_props;
 		rv = 0;
 
 	} else if (memcmp(algorithm, "lzfx", 4) == 0) {
@@ -1969,6 +1986,7 @@ init_algo(const char *algo, int bail)
 		_init_func = lz_fx_init;
 		_deinit_func = lz_fx_deinit;
 		_stats_func = lz_fx_stats;
+		_props_func = lz_fx_props;
 		rv = 0;
 
 	} else if (memcmp(algorithm, "lz4", 3) == 0) {
@@ -1995,6 +2013,7 @@ init_algo(const char *algo, int bail)
 		_init_func = adapt2_init;
 		_deinit_func = adapt_deinit;
 		_stats_func = adapt_stats;
+		_props_func = adapt_props;
 		adapt_mode = 1;
 		rv = 0;
 
@@ -2004,6 +2023,7 @@ init_algo(const char *algo, int bail)
 		_init_func = adapt_init;
 		_deinit_func = adapt_deinit;
 		_stats_func = adapt_stats;
+		_props_func = adapt_props;
 		adapt_mode = 1;
 		rv = 0;
 #ifdef ENABLE_PC_LIBBSC
@@ -2034,7 +2054,7 @@ main(int argc, char *argv[])
 	level = 6;
 	slab_init();
 
-	while ((opt = getopt(argc, argv, "dc:s:l:pt:MCDEew:rLS:B:F")) != -1) {
+	while ((opt = getopt(argc, argv, "dc:s:l:pt:MCDEew:rLPS:B:F")) != -1) {
 		int ovr;
 
 		switch (opt) {
@@ -2124,6 +2144,11 @@ main(int argc, char *argv[])
 			lzp_preprocess = 1;
 			break;
 
+		    case 'P':
+			lzp_preprocess = 1;
+			enable_delta2_encode = 1;
+			break;
+
 		    case 'r':
 			enable_rabin_split = 0;
 			break;
diff --git a/pcompress.h b/pcompress.h
index 4eda4fc..ab01585 100644
--- a/pcompress.h
+++ b/pcompress.h
@@ -56,6 +56,7 @@ extern "C" {
 #define	COMP_EXTN	".pz"
 
 #define	PREPROC_TYPE_LZP	1
+#define	PREPROC_TYPE_DELTA2	2
 #define	PREPROC_COMPRESSED	128
 
 /*
@@ -135,6 +136,11 @@ extern int none_init(void **data, int *level, int nthreads, ssize_t chunksize,
 extern void lzma_props(algo_props_t *data, int level, ssize_t chunksize);
 extern void lzma_mt_props(algo_props_t *data, int level, ssize_t chunksize);
 extern void lz4_props(algo_props_t *data, int level, ssize_t chunksize);
+extern void zlib_props(algo_props_t *data, int level, ssize_t chunksize);
+extern void ppmd_props(algo_props_t *data, int level, ssize_t chunksize);
+extern void lz_fx_props(algo_props_t *data, int level, ssize_t chunksize);
+extern void bzip2_props(algo_props_t *data, int level, ssize_t chunksize);
+extern void adapt_props(algo_props_t *data, int level, ssize_t chunksize);
 
 extern int zlib_deinit(void **data);
 extern int adapt_deinit(void **data);
@@ -188,6 +194,7 @@ struct cmp_data {
 	void *data;
 	pthread_t thr;
 	mac_ctx_t chunk_hmac;
+	algo_props_t *props;
 };
 
 #ifdef	__cplusplus
diff --git a/ppmd_compress.c b/ppmd_compress.c
index a594e71..2ff391b 100644
--- a/ppmd_compress.c
+++ b/ppmd_compress.c
@@ -61,6 +61,11 @@ ppmd_stats(int show)
 {
 }
 
+void
+ppmd_props(algo_props_t *data, int level, ssize_t chunksize) {
+	data->delta2_stride = 100;
+}
+
 int
 ppmd_init(void **data, int *level, int nthreads, ssize_t chunksize,
 	  int file_version, compress_op_t op)
diff --git a/utils/utils.h b/utils/utils.h
index 3fa8721..bd04771 100644
--- a/utils/utils.h
+++ b/utils/utils.h
@@ -111,6 +111,7 @@ typedef struct {
 	int nthreads;
 	int c_max_threads;
 	int d_max_threads;
+	int delta2_stride;
 } algo_props_t;
 
 typedef enum {
@@ -205,6 +206,7 @@ init_algo_props(algo_props_t *props)
 	props->nthreads = 1;
 	props->c_max_threads = 1;
 	props->d_max_threads = 1;
+	props->delta2_stride = 0;
 }
 
 #ifdef	__cplusplus
diff --git a/zlib_compress.c b/zlib_compress.c
index 84833c8..232a006 100644
--- a/zlib_compress.c
+++ b/zlib_compress.c
@@ -89,6 +89,11 @@ zlib_stats(int show)
 {
 }
 
+void
+zlib_props(algo_props_t *data, int level, ssize_t chunksize) {
+	data->delta2_stride = 50;
+}
+
 int
 zlib_deinit(void **data)
 {