A novel fuzzy video rate control algorithm (RCA) with delay and quality constraints is proposed for video streaming over DVB-H (Digital Video Broadcasting for Handheld terminals) application. In this application a variable bit rate (VBR) bit stream is used to improve the quality and compression performance of encoded video at the expense of buffering delay while there is a holdup as channel changing delay. DVB-H uses a time-sliced transmission scheme to reduce the power consumption for the receiver. The time-slice scheme amplifies the channel changing delay. Two main factors in channel changing delay are the time until a media decoder is refreshed by a random access point such as an IDR (Instantaneous Decoder Refresh) picture in H.264/AVC and the delay to compensate the variation in bit rate. The average decoder refresh delay can decrease by frequent IDR pictures in the bit stream while it drops the quality and compression efficiency remarkably. On the other hand, a VBR video provides higher quality at the expense of higher buffering delay. Hence force, there is a multilateral contradiction between the quality and delay in this application. The proposed RCA has been optimized to provide high quality VBR video with minimum channel changing delay. Simulation results on H.264/AVC video coding standard show that encoded bit streams by proposed RCA strictly obey the delay and quality constraints.