XML documents are extremely verbose since the "schema" is repeated for every "record" in the document. While a variety of compressors are available to address this problem, they are not designed to support direct querying of the compressed document, a useful feature from a database perspective. In this paper, we propose a new compression tool called XGrind, that directly supports queries in the compressed domain. A special feature of XGrind is that the compressed document retains the structure of the original document, permitting reuse of the standard XML techniques for processing the compressed document. Performance evaluation over a variety of XML documents and user queries indicates that XGrind simultaneously delivers improved query processing times and reasonable compression ratios.