Summary: Regularization may be regarded as diffusion filtering with an implicit time discretization where one single step is used. Thus, iterated regularization with small regularization parameters approximates a diffusion process. The goal of this paper is to analyze relations between noniterated and iterated regularization and diffusion filtering in image processing. In the linear regularization framework, we show that with iterated Tikhonov regularization noise can be better handled than with noniterated. In the nonlinear framework, two filtering strategies are considered: the total variation regularization technique and the diffusion filter technique of Perona and Malik. It is shown that the Perona-Malik equation decreases the total variation during its evolution. While noniterated and iterated total variation regularization is well-posed, one cannot expect to find a minimizing sequence which converges to a minimizer of the corresponding energy functional for the Perona-Malik filter. To overcome this shortcoming, a novel regularization technique of the Perona-Malik process is presented that allows to construct a weakly lower-semicontinuous energy functional. In analogy to recently derived results for a well-posed class of regularized Perona-Malik filters, we introduce Lyapunov functionals and convergence results for regularization methods. Experiments on real-world images illustrate that iterated linear regularization performs better than noniterated, while no significant differences between noniterated and iterated total variation regularization have been observed.