GIF (Graphics Interchange Format) is a bitmap image format developed by CompuServe in 1987. Its key feature is support for animation (multiple frames played in sequence), which made it the de-facto format for early web animations and memes. GIF uses LZW lossless compression but is limited to a palette of 256 colors, making it unsuitable for photographs.
The 256-color limitation causes significant quality degradation for photographic content (color banding and dithering artifacts). However, for graphics with flat colors — logos, icons, simple animations — the quality is acceptable. GIF files become very large for complex animations; a 5-second animation at 720p can easily exceed 20MB.
Modern alternatives are significantly better: WebP animated is up to 64% smaller than GIF with full color support. MP4 video is up to 98% smaller. For new projects, use WebP animated or MP4 instead of GIF. For converting video to GIF, use FileCurve's Video to GIF tool — though consider whether the use case truly needs GIF vs WebP or video.