If you’ve ever saved an image, you’ve had to pick a format for it (or had it picked for you by a program). Understanding the basic differences between formats and their best applications is really valuable for managing image quality, file size, and—if you’re posting it to the web—page load speed.

Here’s the short version:

• JPG/JPEG: Great for still photos.  Keeps file sizes down at the expense of some image quality. If you’re using photos, they should be JPGs. Period.
• PNG: There are two types, but you’ll probably use PNG-24 most. Excellent for high-quality graphic images or those with complex transparency in them. Use a tool like TinyPNG, one of my favorite web utilities, to keep file sizes under control.
• GIF: Allows [often-ill-advised] animations. Good for tiny images with only a few colors.

But that’s boring. Check out this fun infographic instead!

Source: WhoIsHostingThis.com