The minimized average error bilevel display algorithm of Floyd et al.[1] is extended to a general n-level error feedback filter for the display of monochrome and natural color pictures. This error feedback filter that operates recursively on the net system input-output errors using the so-called two-dimensional nonsymmetric half-plane window[16] is analyzed to obtain the optimal properties. In this approach, instead of the commonly used distortion measure defined by pixelto pixel mean square error, a low-pass filter impulse response is used in spatial domain to define a more reasonable distortion measure to the concept of error diffusion. Based on the optimal properties of the proposed model, some examples of designing the optimal recursive coefficients utilizing the 2-D IIR filter design technique of Ekstrom et al.[16,17] are shown. And the experimental results are also illustrated for both monochrome and natural color pictures.