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This paper presents a compact architecture for analog CMOS hardware implementation of voltage-mode pulse-coupled neural networks (PCNN's). The hardware implementation methods shows inherent fault tolerance specialties and high speed, which is usually more than an order of magnitude over the software counterpart. A computational style described in this article mimics a biological neural network using pulse-stream signaling and analog summation and multiplication. Pulse-stream encoding technique uses pulse streams to carry information and control analog circuitry, while storing further analog information on the time axis. The main feature of the proposed neuron circuit is that the structure is compact, yet exhibiting all the basic properties of natural biological neurons. Functional and structural forms of neural and synaptic functions are presented along with simulation results. Finally, the proposed design is applied to image processing to demonstrate successful restoration of images and their features.