The paper discusses the application of System on Chip devices for processing Megapixel video streams. The domain of image processing using high resolution images is very demanding in the scope of calculating power and frequently exploits special processing hardware. The progress of integration technology brings about SoC which are capable of meeting such processing demands. Characteristics of FPGA and DSP based systems are assessed. A concise survey of chip solutions is presented and a pair of representative systems is chosen for comparison of their properties. The design of a smoke detection system is used for evaluating the advantages and drawbacks of using such SoC solutions. Almost identical image processing algorithms are implemented in the case of FPGA and DSP. Both solutions meet the image processing requirements and are suitable for real time processing. FPGA based solution is much faster as it uses pipelining for improving the utilisation of scarce memory resources.