When choosing between JPEG and RAW formats, it's usually best to use the largest available JPEG size and the least compression available. If you shoot the image at a lower quality setting, you can never really improve it much or get a large, sharp print if you want one. The only problem with this approach is that higher quality images have larger file sizes.

RAW images are always captured at the largest file size, and any compression used is lossless. Images in this format used to require an extra processing step.

There are a number of advantages to using the RAW format:
RAW lets you decide on most camera settings after you've taken the picture, not before. For example, when you shoot a JPEG image under fluorescent lights, the camera adjusts the image to remove the yellow-green tint.

If you shoot the image in RAW format, the camera just captures the images as is and you decide what white balance setting to use later. RAW images can be processed again at a later date

There are also drawbacks to using RAW images. RAW files are quite large. If you use this format a great deal you will need more storage space in the camera, and computer processing times may be slightly longer. Since RAW images aren't processed in the camera.

Since each camera company has defined its own proprietary RAW format, many operating systems and even photo-editing programs are unable to recognize some or all of these files. For this reason camera manufacturers always supply a program to process RAW images along with their cameras.