Homomorphic encryption becomes one of the key components in many emerging applications, e.g., cloud computing, to achieve privacy-preserving data processing. However, one of the major drawbacks that precludes the widespread adoption of homomorphic encryption is the huge expansion of the ciphertext. This problem becomes even more severe when multimedia data (images/videos) are handled, as these files are essentially of large sizes. The paper “An Efficient Image Homomorphic Encryption Scheme with Small Ciphertext Expansion” (In Proc. ACM MM’13, pp.803-812) presented a novel image homomorphic encryption approach achieving significant reduction of the ciphertext expansion. In the current work, we first study the security of this cryptosystem under a ciphertext-only attack (COA). We show that our proposed COA is effective in generating a sketch of great fidelity of the original image. Experimental results are provided to verify the validity of the proposed attack strategy. In addition, we further propose a strategy of reducing the ciphertext expansion in image homomorphic encryption through a linear interpolation technique. To this end,a randomly selected subset pixels are encrypted using are encrypted using homomorphic cryptosystem to form one part of the ciphertext. The remaining pixels are encrypted by relating them with this random subset through a linear interpolation technique. The whole homomorphically encrypted image can be obtained, upon receiving all the ciphertexts, by exploiting the homomorphic property and the linearity. We provide our security discussion and validate our arguments with experiments. It is demonstrated that the proposed scheme is capable of achieving significant reduction of the ciphertext expansion compared with other schemes, while perfectly preserving the homomorphic property