diff --git a/README.md b/README.md
index e86d13a..65725e0 100644
--- a/README.md
+++ b/README.md
@@ -176,7 +176,7 @@ As of 1.4.18, syncoid also automatically supports and enables resume of interrup
 
 + --compress <compression type>
 
-	Currently accepted options: gzip, pigz-fast, pigz-slow, zstd-fast, zstd-slow, lz4, lzo (default) & none. If the selected compression method is unavailable on the source and destination, no compression will be used.
+	Currently accepted options: gzip, pigz-fast, pigz-slow, zstd-fast, zstd-slow, lz4, xz, lzo (default) & none. If the selected compression method is unavailable on the source and destination, no compression will be used.
 
 + --source-bwlimit <limit t|g|m|k>
 
diff --git a/syncoid b/syncoid
index ccc5861..3eab26a 100755
--- a/syncoid
+++ b/syncoid
@@ -675,6 +675,12 @@ sub compressargset {
 			decomrawcmd => '/usr/bin/zstd',
 			decomargs   => '-dc',
 		},
+		'xz' => {
+			rawcmd      => '/usr/bin/xz',
+			args        => '',
+			decomrawcmd => '/usr/bin/xz',
+			decomargs   => '-d',
+		},
 		'lzo' => {
 			rawcmd      => '/usr/bin/lzop',
 			args        => '',
@@ -691,7 +697,7 @@ sub compressargset {
 
 	if ($value eq 'default') {
 		$value = $DEFAULT_COMPRESSION;
-	} elsif (!(grep $value eq $_, ('gzip', 'pigz-fast', 'pigz-slow', 'zstd-fast', 'zstd-slow', 'lz4', 'lzo', 'default', 'none'))) {
+	} elsif (!(grep $value eq $_, ('gzip', 'pigz-fast', 'pigz-slow', 'zstd-fast', 'zstd-slow', 'lz4', 'xz', 'lzo', 'default', 'none'))) {
 		warn "Unrecognised compression value $value, defaulting to $DEFAULT_COMPRESSION";
 		$value = $DEFAULT_COMPRESSION;
 	}
@@ -1431,7 +1437,7 @@ syncoid - ZFS snapshot replication tool
 
 Options:
 
-  --compress=FORMAT     Compresses data during transfer. Currently accepted options are gzip, pigz-fast, pigz-slow, zstd-fast, zstd-slow, lz4, lzo (default) & none
+  --compress=FORMAT     Compresses data during transfer. Currently accepted options are gzip, pigz-fast, pigz-slow, zstd-fast, zstd-slow, lz4, xz, lzo (default) & none
   --identifier=EXTRA    Extra identifier which is included in the snapshot name. Can be used for replicating to multiple targets.
   --recursive|r         Also transfers child datasets
   --skip-parent         Skips syncing of the parent dataset. Does nothing without '--recursive' option.