JPEG quality levels
If you save images in JPEG format some original image information will be lost, due to how JPEG compresses images. Considering that our eyes perceive small color changes less accurately than small changes in brightness, JPEG averages the color data in blocks of 8 by 8 pixels. An advantage of using JPEG is that file sizes will be considerably smaller than with lossless compression methods such as TIFF.
Although digital images can be compressed at up to 100 JPEG quality levels most digital cameras that use JPEG let you save the images at three settings, usually marked Fine, Normal or Low, though the exact terms used may vary from one manufacturer to the other.
This means that you have a choice as to how much information will be lost during compression and consequently what the final quality of your image will be.
As it is not always possible to determine beforehand what an image will be used for, we would advise you to always use the highest quality setting, since information lost can never be retrieved. Also, with more image information available, correcting or sharpening an image without perceivable quality loss will be much easier. Repeatedly opening and saving a JPEG image will lose a little more image quality each time, since an already compressed image will be compressed again, causing even more information to be lost.