Lossy: This type of compression is a encoding method which means that it will loose some of the data i.e quality. Lossy compression is usually common in audio, video and still images. JPEG is an example of a lossy format.
Lossless: This form of compression means that no data will be lost through compression, an example of this is a PNG file. What this means is that when an image is compressed it will not loose any quality but the file size will be reduced significantly

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