Lossy compression is a method of reducing the size of a file by permanently eliminating some data. This technique is commonly used for images, audio, and video files, where a perfect reproduction is not necessary. For example, JPEG images and MP3 audio files use lossy compression to decrease file size while maintaining acceptable quality for most users. The main advantage of lossy compression is that it significantly reduces storage space and bandwidth usage, making it easier to share and store files. However, the downside is that once the data is removed, it cannot be recovered, which may lead to a loss of detail or clarity in the original content.