Over the past decade, many research groups have developed reconfigurable computing systems built from Field Programmable Gate Arrays (FPGAs) for on-board processing of remote sensing data. Physical Sciences Inc. (PSI) proposes to exploit the run-time reconfiguration capabilities of SRAM-based FPGAs to demonstrate an innovative extension to the current state-of-the-art -- an autonomous, adaptive digital signal processor. PSI?s Reconfigurable Environmentally Aware Computing Technology (REACT) will automatically customize applications executing on a reconfigurable FPGA processing system based on external inputs. In Phase I, we will validate the REACT concept by processing images from a digital video camera with a variable-precision 2D integer wavelet transform in a Xilinx Virtex-II FPGA. Wavelet transforms enable image data compression with dynamically tunable compression ratios. Quantization of the filter coefficients will be controlled by a master state machine with inputs from a GPS receiver and PSI?s SEU Alarm, a compact sensor that monitors the surrounding environment for radiation hazards. Furthermore, PSI will develop a Phase II system design capable of performing a full-scale demonstration using hyperspectral imagery.