To create a progressive JPG/JPEG image or to save a JPG/JPEG image as progressive JPG/JPEG, you just need to use imageinterlace function.
Syntax:

imageinterlace($img_res, true);

Here's an example to use this function:

<?php
    // Create an image instance
    $img = imagecreatefromjpeg('test.jpg');
    // Enable interlancing
    imageinterlace($img, true);

    // Save the interlaced image
    imagejpeg($img, './test-result.jpg');
    imagedestroy($img);
?>

To learn more about progressive JPEG:
http://forum.xhanch.com/index.php/topic,2655.0.html