Each of the 1677216 colours (256 × 256 × 256) is used just once. If there are more than 1677216 pixels in the pic, the remainder are left transparent, if there are fewer than 16777216, then they’re all filled but not all those possible colours are used.

Colours are chosen first based upon RGB values of each pixel, if that colour is already used the nearest colour in numeric terms is found; because of the way that RGB is organised as a number (i.e.red × 65536 + green × 256 + blue). this means when looking for nearest match looking through the blues first, then the greens, then the reds.

Pixels are looked at starting with the central pixel and working round in an anticlockwise direction. The central pixels therefore will all be the original from the photo, because the colour hasn’t been used yet.