Preservation of geometrical context of terrains in a digitized format is useful in handling and making modification to the data. Digitization of three-dimensional terrain still proves a great challenge due to heavy load of context required to retain details of topological and geometrical information. Methods of simplification, restoration and multi-level terrain generation are often employed to transform the original data into a compressed digital format. However, reduction of the stored data size comes at an expense of loss of details in the original data set. This article reports on an alternative scheme for simplification and restoration of terrain data. The algorithm utilizes the fact that the terrain formation and patterns can be predicted and modeled through the fractal algorithm. This method was used to generate multi-level terrain model based on NGIS digital maps with preserving geometrical context of terrains.