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GIF (Graphic Interchange Format)
files use a maximum of 256 colors, and are best for displaying noncontinuous-tone images or those with large areas of flat colors, such as navigation bars, buttons, icons, logos, or other images with uniform colors and tones.

JPEG (Joint Photographic Experts Group)
file format is the superior format for photographic or continuous-tone images, because JPEG files can contain millions of colors. As the quality of a JPEG file increases, so does the file size and the file download time. You can often strike a good balance between the quality of the image and the file size by compressing a JPEG file.

PNG (Portable Network Group)
file format is a patent-free replacement for GIFs that includes support for indexed-color, grayscale, and true-color images, and alpha channel support for transparency. PNG is the native file format of Macromedia Fireworks MX. PNG files retain all the original layer, vector, color, and effects information (such as drop shadows), and all elements are fully editable at all times. Files must have the .png file extension to be recognized as PNG files by Adobe Dreamweaver CS3.