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There are a variety of different file formats that you might run into while you're using Photoshop, so let's talk about the first one, which is PSD. When you open up a document into Photoshop, Photoshop temporarily puts that document into the PSD file format, and it allows you to add layers and save channels and do all sorts of things. So I use the PSD file format when I am saving out kind of my master Photoshop documents, the ones that have multiple layers. They might have type, they might have adjustment layers, and Photoshop will save all of those in the PSD file format.
From there, I will go ahead and save out my derivatives. Like if I have to send someone a JPEG file, I would save my PSD with all the layers and then send them the JPEG file, which would be flattened. But before we get to JPEG, let's talk about TIFF a little bit. The TIFF file format can also save out layers. It can basically save anything that a PSD file can save. The nice thing about a TIFF file is that you can place it into other applications beyond the Adobe Suite applications.
So for example, if I was taking my image from Photoshop and I wanted to place it into InDesign or if I wanted to place it into After Effects, I'm perfectly fine taking my PSD file into those applications. But if I wanted to take a file into a different application, maybe Quark for example, then I might want to actually save that as a TIFF, and probably not necessarily with layers. I'd probably want to flatten a TIFF file in order to take into that other application. You should just know that the TIFF file format does actually support layers.
All right, when you save your files as JPEG files, you need to know that two things happen. One, Photoshop will automatically flatten your image, because the JPEG file format does not support multiple layers. And the JPEG file format is always compressed and it's compressed using lossy compression, which means that the JPEG file format throws away a lot of colors in order to compress the file and make it so small. The JPEG file format is an excellent way to share your images, but you've got to pick the balance when you're saving the JPEGs as far as how much you compress the file--the more compression the smaller the file--but you're also going to lose quality.
So you've got to balance the quality with the compression. As far as the GIF or GIF file format, that's another flat file format; it does not support layers. It is compressed, but it's compressed in a different way from the JPEG. The JPEG file format can still have thousands of colors in it, whereas the GIF file format has a maximum of 256 colors. But as a bonus, it does support transparency, so you could take an image into another application that supported transparency and you could actually see through any transparent areas in your GIF file.
The PNG file format is also an excellent file format. It's great for working with other applications like Flash, or you can use it in applications like Lightroom, if you're creating an identity plate or a watermark, because the PNG file format, or PNG file format, supports full alpha channel masks. So the GIF file format only supports one level of transparency. The pixels are either on or off. But the PNG file format actually allows you to have 256 different levels of transparency, so you can have nice subtle areas of transparency.
PDF is another file format that you might want to save your image in if you're going to be distributing it to someone. Anyone can read a PDF file if they download the free Acrobat reader. And the nice thing about PDF is that it will allow me to apply security settings, so that if I want to limit the ability to open or the ability to print the file, I can enter in a password when I save the document and that way the person who receives the document would also need to know that password to either open the file or I could allow anyone to open it, but they might need the password to print the file.
And finally, DNG, which we've mentioned before. DNG is the Digital Negative file format. It's an openly documented, openly licensed archival format for saving out raw files. So that's a brief overview of the seven most popular file formats that you'll run across while you're working in Photoshop.
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