Abstract : The bag-of-words (BoW) model treats images as an unordered set of local regions and represents them by visual word histograms. Implicitly, regions are assumed to be identically and independently distributed (iid), which is a poor assumption from a modeling perspective. We introduce non-iid models by treating the parameters of BoW models as latent variables which are integrated out, rendering all local regions dependent. Using the Fisher kernel we encode an image by the gradient of the data log-likelihood w.r.t. hyper-parameters that control priors on the model parameters. Our representation naturally involves discounting transformations similar to taking square-roots, providing an explanation of why such transformations have proven successful. Using variational inference we extend the basic model to include Gaussian mixtures over local descriptors, and latent topic models to capture the co-occurrence structure of visual words, both improving performance. Our models yield state-of-the-art categorization performance using linear classifiers; without using non-linear transformations such as taking square-roots of features, or using (approximate) explicit embeddings of non-linear kernels.