When you save files from Illustrator, the three main choices you have for print production work are Adobe Illustrator Document (.ai), Illustrator EPS (.eps), and Adobe PDF (.pdf). The following is a brief rundown of the formats you can choose to save your files as when using Illustrator. This is Adobe’s native Illustrator format, and only Illustrator is able to read this file format. The data contained in the file is based on PDF, but it isn’t a format that Acrobat can read correctly. When saving in .ai format, you retain all your editability and transparency in your file. When you save your file as an .ai file, Illustrator includes a PDF 1.4 composite preview inside the file in an unflattened form. The .ai format is the best format to save your file as for internal use while you’re still working on the file, as well as for placing into Photoshop or InDesign. The .ai format is my preferred method for saving files, as I use InDesign for my page layout. However if you use Quark XPress, you’ll have to stick with the older .eps format explained below. This long-standing file format, which is short for Encapsulated PostScript, is supported by most all standard graphics applications. Unfortunately, .eps files do not support transparency, so files you create that contain transparency are “flattened” so other programs can import them. When you save as an .eps, most effects are expanded and text may or may not be broken apart in order to flatten the file – however Illustrator saves a copy of the file in .ai format inside the .eps file so that you can edit the file later in Illustrator if you wish. The .eps format has been widely used as the “standard” file format for saving artwork to be used for print production work with Quark XPress for many years, but recently began loosing love from users due to its large file size and lack of support for transparency. Personally, I no longer use the .eps format. Since the introduction of InDesign and Smart Objects in Photoshop, I find the .ai format for flexible and the file sizes more manageable. We all know what a PDF is. When you save a file from Illustrator as a .pdf file, Illustrator saves the data so that any PDF reader can understand and display the file. Thankfully, Illustrator saves a copy of the file in native .ai format inside the PDF file which is unflattened for later editing – as long as you remember to leave the Preserve Illustrator Editing Capabilities checkbox ticked as it is as a default. If you uncheck that box, the file size is drastically reduced, but so are your options for editing the file later. Text will be virtually uneditable, effects are flattened, etc. I generally don’t recommend saving your files as PDFs from Illustrator. This format is exactly what it says. It’s a template format for Illustrator that allows you to save your file as a template for using as a “building block” for later files. SVG stands for Scalable Vector Graphics and is an XML markup language for describing two-dimensional vector graphics, both static and animated and is an open standard created by the World Wide Web Consortium. The SVG format can contain vector shapes and paths, raster graphics (images) and text. The SVG format is mostly used for Web-based work, and is beyond the scope of this article, so I won’t bother to go into it here. Illustrator also allows you to “export” your file to nearly a dozen other formats (which also means it can read them) such as .jpg, .png, .swf (Flash), .bmp, .tif, .txt (text format), .wmv (Windows meta file) and .dxf (AutoCAD Interchange Format). Overall, Illustrator has a lot of flexibility in the formats it saves as, allowing you to maximize the file use in other applications. Source.