GIF stands for Graphics Interchange Format The GIF image file format was created by and is the copyrighted property of CompuServe Incorporated. This is the original name of the committee that wrote the standard for the image format. Gif and JPEG files are raster or bitmapped images. This means that the image you see is made up of many individual picture elements called pixels or dots.
Every pixel has a color value and position in the image.
In a bitmapped image there are no blank areas. A black outlined square filled with white has the same number of pixels as a same sized square with green line and orange fill. In other words, they take an uncompressed bitmapped image, and compress it to a smaller file size. The result of this conversion is an image with the same on-screen dimensions as the original but having a significantly smaller file size, while image quality is not noticeably degraded. Both methods result in some loss or data.