GIF

The letters "GIF" actually stand for "Graphics Interchange Format," but you don't need to know that. GIFs are compressed graphics files and use a compression formula originally developed by CompuServe (which is why you see the term CompuServe GIF all the time with Phototshop, for those of you that care...) GIFs you see on the Web use indexed color, or a palette of a certain number of colors (at most 256), which greatly helps reduce their file size. These compressed files can be quickly transmitted over a network or the Internet. GIF files are great for little icons and for animated images, but they lack the color range to be used for high-quality photos.