This paper studies the restoration of color-quantized images. Restoration of color-quantized images is rarely addressed in the literature, and direct applications of existing restoration techniques are generally inadequate to deal with this problem. We propose a restoration algorithm specific to color-quantized images, which makes a good use of the available color palette to derive useful {em a priori} information for restoration. The proposed restoration algorithm is shown to be capable of improving the quality of an color-quantized image to a certain extent.