GIF file

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GIF files support 1-bit transparency and 256 colors in an image, so in that aspect they are inferior to PNG files. However, they support animation. Also, since they are a lossless compressed format, they have advantages over JPG files and BMP files.

256 colors
Unlike the other formats, GIF only supports 256 colors in an image. Fortunately, this is paletted, so the colors can be anything you want, but things like gradients and anti-aliasing will suffer. This also means that colors may be shifted by your graphics software, so be sure to check the final palette before setting transparent colors in your <background> code.
Compression
GIF uses LZW compression. The file size is usually smaller than BMP, and lossless JPEG2000.
Lossless
Unlike a JPG file, none of the data is lost when you compress an image using the GIF format. (Other than the initial loss of colors, of course.)
Transparency
Unlike a PNG file, which has 8-bit transparency, GIF has 1-bit transparency, which means things can have only 1 level of transparency, on or off.
Patented
Unisys owns the patent to the compression algorithm used in GIF files and was enforcing it. This prompted many to look for unpatented formats such as PNG files.
Animation
GIF's primary advantage (especially for Trillian skinning) is that it supports animation. However, remember that the 256 color limitation applies to the entire file, not just a single frame.


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