The JPEG compression algorithm is at its best on photographs and paintings of realistic scenes with smooth variations of tone and color. For web usage, where the amount of data used for an image is important, JPEG is very popular. JPEG/Exif is also the most common format saved by digital cameras.

On the other hand, JPEG may not be as well suited for line drawings and other textual or iconic graphics, where the sharp contrasts between adjacent pixels can cause noticeable artifacts. Such images may be better saved in a lossless graphics format such as TIFF, GIF, PNG, or a raw image format. The JPEG standard actually includes a lossless coding mode, but that mode is not supported in most products.

As the typical use of JPEG is a lossy compression method, which somewhat reduces the image fidelity, it should not be used in scenarios where the exact reproduction of the data is required (such as some scientific and medical imaging applications and certain technical image processing work).

JPEG is also not well suited to files that will undergo multiple edits, as some image quality will usually be lost each time the image is decompressed and recompressed, particularly if the image is cropped or shifted, or if encoding parameters are changed – see digital generation loss for details. To avoid this, an image that is being modified or may be modified in the future can be saved in a lossless format, with a copy exported as JPEG for distribution.

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