The question of which audio format to use comes down to finding the right balance between audio quality and file size. WAV files offer users full quality audio at a much larger file size, while MP3 compresses the file size at a loss of quality.
History of MP3
MP3 was developed in the 1980s as an audio encoding format. MP3 files are compressed by reducing the accuracy of certain aspects of a sound file that the algorithm finds to be beyond the capacity of normal human hearing.
History of WAV
WAV is an audio file format developed by Microsoft to store raw audio data. It is supported by all operating systems and is used in many settings due to its flexibility.
Lossy vs. Lossless
WAV is a "lossless" audio format. This means that no aspect of the audio file is obscured, removed or de-emphasized in an effort to reduce the size of the file. MP3 is a "lossy" format, which means that it will smooth over certain parts of the audio recording to reduce file size.
WAV files are large since they represent the raw audio recording. MP3 files have become the standard for portable media devices thanks to their relatively high quality at smaller file sizes.
The sound quality of WAV files is much higher than that of MP3 files since it is raw audio. For casual listening, MP3s retain a high enough level of quality at such a small file size to justify their widespread use.