What type of content are you trying to compress (DVD, Raw video from a camcorder, etc.) and what are you planning on using it for (Web, archiving to cd/dvd)?
Depending on the sources and how you want to use the outputted video there are quite a few different choices. Right now compression to quality size I'd probably reccomend DIVX 6, I've been playing with it for a couple days now and it's actually beating MS"s and Quicktimes quality for compressing video.