Abstract: Mobile data channels carry different communication services with different data formats and rates. In modern CDMA systems as in UMTS, such different data rates and services are carried in a fixed frame. This results with some free data gaps in the frame. A novel coding concept called Variable Redundancy Coding VRC to replace the currently used bit repetition for filling such gaps is presented. The key idea behind the proposed Variable Redundancy Coding VRC is simple: instead of repeating bits to match the channel rate, block code redundancy bits are stuffed in the free gaps. Such VRC bits particularly improve Frame Error Rate FER and at the same time fill the free gaps. This results with more efficient overall channel throughput, as the data throughput depends mainly on the frame error rate and on the ARQ strategy employed. A particular Variable Redundancy Coding technique based on burst error correcting Fire code is presented and is shown to be effective to optimize the overall system performance.