FLAC stands for Free Lossless Audio Codec. The FLAC project consists of: 

   - the stream format 
   - libFLAC, a library which implements a reference encoder, stream decoder,
     and file decoder 
   - flac, which is a command-line wrapper around libFLAC to encode and
     decode .flac files 
   - input plugins for various music players (Winamp, XMMS, and more in the
     works) 

What FLAC is:
   - FLAC is patent free
   - FLAC is lossless
   - FLAC is designed to compress audio data
   - The compression capabilities of FLAC are extendable
   - The currently implemented compression methods in the reference encoder
     yield streams smaller than shorten
   - FLAC is asymmetric in favor of decode speed
   - FLAC is suitable for archiving
   - FLAC is suitable for streaming
   - FLAC supports fast sample-accurate seeking
   - FLAC has an extendable metadata system

WWW: http://flac.sourceforge.net/