Although ATM can deliver VBR traffic by using AAL2 or AAL5, but burst traffic still has the probability to be lost due to network congestion. We propose an adaptive rate control method for MPEG traffic over ATM. It presets the coding rate for each frame based on the connection level which represents the network condition as well as the type of next frame. The quality control system at the encoder end adjusts connection level based on the quality status message from quality monitoring unit at decoder. The simulation results show that the quality control system can utilize the channel bandwidth efficiently as well as maintain satisfactory video quality at various network conditions.