What is FLAC?

FLAC  is a Free Lossless Audio Codec.

FREE

FLAC is a free and open codec (license). It is currently developed by Josh Coalson and promoted by non-profit Xiph.Org Foundation (also known for Ogg Vorbis). FLAC format has no patents, sources are open and released under BSD and GPL licenses.

LOSSLES

FLAC provides lossless compression, meaning your audio files don't lose anything in quality.

AUDIO CODEC

Codec is a short for "Coder/Decoder". Audio Codec is a software implementation of Audio compression algorithms on your computer. These algorithms are engine for compression and decompression of your music.

And what the hell does that mean?

FLAC is a codec for audio compression that reduces size of the file while it preserves FULL  audio quality. You'll recognize files compressed  with this codec by their ".flac" extension. Current version of the codec is FLAC 1.2.1