Abstract: In this paper we propose a method which improves the efficiency of video coding. Our method combines an adaptive GOP (group of pictures) structure and the shot cut detection. We have analyzed different approaches for shot cut detection with aim to choose the most appropriate one. The next step is to situate N frames to the positions of detected cuts during the process of video encoding. Finally the efficiency of the proposed method is confirmed by simulations and the obtained results are compared with fixed GOP structures of sizes 4, 8, 12, 16, 32, 64, 128 and GOP structure with length of entire video. Proposed method achieved the gain in bit rate from 0.37% to 50.59%, while providing PSNR (Peak Signal-to-Noise Ratio) gain from 1.33% to 0.26% in comparison to simulated fixed GOP structures.