RAW vs JPEG in DSLR cameras

JPEG Advantages

1. JPEGs are processed by the camera so time is saved.
2. They take up less space on the memory card.
3. The cameras buffer empties quicker so you can keep shooting.
4. Since JPEGs are smaller than RAW, the maximum burst rate is much higher which is good for action.

JPEG Disadvantages

1. Data is thrown away when the JPEG is first made and each time you save it thereafter.
2. JPEGs are limited to 8 bits of data which can cause posterization. This means you may lose continuous tones which cause banding, especially if you work on the image extensively with software.
3. The processing parameters such as color space, white balance, contrast, exposure, saturation, and sharpening are locked into the file. This reduces your ability to make adjustments later with software.

RAW Advantages

1. Since these files contain unprocessed raw data from the sensor, you have tremendous control over white balance, sharpening, contrast, color, saturation, and exposure.
2. RAW files are more than 8 bits so you have more head-room (less chance of losing continuous tones) when using software to optimize the image.
3. RAW converters offer excellent adjustments for noise control and lens defects.

RAW Disadvantages

1. These large files fill memory cards fast.
2. The number of images that can be shot in a continuous burst is greatly reduced.
3. They must be processed by a RAW converter so this takes plenty of time.