When working with clients and on projects it important to be provided the best assets to deliver the best product. However, there is a language barrier between clients and developers and due to lack of experience and/or knowledge when it comes to file types. To help combat this and educate the client we have found that it is easier to show an example than try to explain the difference between Vector and Raster file types.
Raster Files:
A raster file type is an image or graphic composed of a grid of pixels or squares. Raster files are ideal for photographs, web and screen images. These files can be scaled down and look good, however when scaled up lose quality and end up looking like big colorful blocks.

Advantages:
- Amazing gradient and shading display
- Very common file types
Disadvantages:
- Large File Sizes
- Can be scaled down, but not up without losing quality
- Some file types require special software to view/display
Common Raster File Types:
- .bmp, .cdr, .ccx, .cdt, .cmx, .ico, .jpg, .jpeg, .gif, .pdf, .png, .tga, .tif, .tiff,
Ideal Useage:
- Photographs
- Web Graphics
- Screen Graphics (TV, DVD)
Vector Files:
A Vector file is an image or graphic composed of connecting points, lines, curves, and shapes or polygon(s), which are all based upon mathematical equations, to represent an images. Vector files are ideal for any design, illustratopn, icon, or logo that needs to be scaled and retain a crisp clean look.

Advantages:
- Can be scaled up or down and retain quality
- Small file sizes
Disadvantages:
- Not as good at shading as raster (i.e photograph)
- Some file types require special software to view/display
Common Vector File Types:
- .ai, .cdr, .ccx, .cdt, .cmx, .eps, .pdf, .svg, .swf,
Ideal Useage:
- Logo's
- Print Materials (Usually a combination of vector type and raster images)
- Illustrations
- Typography
- Flash
- Anything that will be scaled
For a detailed file type comparison chart: Wikipedia
