New variable-order fractional chaotic systems are proposed in this paper. A concept of short memory is introduced where the initial point in the Caputo derivative is varied. The fractional order is defined by the use of a piecewise constant function which leads to rich chaotic dynamics. The predictor–corrector method is adopted, and numerical solutions of fractional delay equations are obtained. Then, this concept is extended to fractional difference equations, and generalized chaotic behaviors are discussed numerically. Finally, the new fractional chaotic models are applied to block image encryption and each block has a different fractional order. The new chaotic system improves security of the image encryption and saves the encryption time greatly.