JPEG is a form of lossy compression most commonly used for digital images, in particular digital photography.
What is Lossy Compression? Lossy compression is a class of data encoding methods that use approximations and partial data to represent the original whole. These methods help reduce the overall size of the data for storage purposes as well as handling and transmitting. This is opposite of lossless data compression which does not degrade the image.
With JPEG you can adjust the level of compressions to allow for a given tradeoff between storage size and image quality: the larger the file, the higher the quality. Using JPEG it is easy to achieve 10:1 compression with little loss in image quality.
JPEG compression algorithm works best on photographs and paintings of real scenes. The compression makes this algorithm ideal for use by digital cameras and the Internet as storage capacity and transmission is the primary concern, not quality. It is this lossy compression method that makes these file types NOT ideal for printing. It is preferred to have a lossless graphics format such as TIFF or RAW.
JPEG stands for Joint Photographic Experts Group, the creators of the compression standard. The group was organized in 1986 underneath the International Standards Organization (ISO) and the International Electrotechnical Commission (IEC). It wasn’t until 1992 that the first JPEG standard was introduced.