Realistic display of high-dynamic range images is a difficult problem. Previous methods for high-dynamic range image display suffer from halo artifacts or are computationally expensive. We present a novel method for computing local adaptation luminance that can be used with several different visual adaptation-based tone-reproduction operators for displaying visually accurate high-dynamic range images. The method uses fast image segmentation, grouping, and graph operations to generate local adaptation luminance. Results on several images show excellent dynamic range compression, while preserving detail without the presence of halo artifacts. With adaptive assimilation, the method can be configured to bring out a high-dynamic range appearance in the display image. The method is efficient in terms of processor and memory use.