Hitfirm.com

You see the picture in your bookmarks if you are using Internet Explorer or Firefox and don’t know what it is. Or you are looking at your server logs and see that quite a few people are looking for a file called favicon.ico and they can’t find it. You never had a file called that and don’t know how someone can be looking for that file. What those both have in common is that they involve the same file. It is called favicon.ico and it is a small picture that is used by web designers to give a graphic representation to their site with a small 16 X 16 image in an icon format. This is a file format for images like .jpg, .gif, or .tiff. The difference is that .ico are smaller and with few colors. Because of these constraints on size and color the images tend to be very simple with little content.
Who has them?
Typically larger professionally managed sites are the most likely to have these images integrated on their sites so if you bookmark it you get a copy stored on your computer along with the actual bookmark. If you have never seen these here are some examples:

http://www.yahoo.com/favicon.ico - A simple “Y”

http://www.altavista.com/favicon.ico - The popular search engine - “AV”

http://www.msn.com/favicon.ico - A very small picture - the MS butterfly

These are created with an icon image editor, which are quite similar to other drawing programs except they are made for this format’s small size and color selection. With this size the creation process almost seems like tic-tac-toe with 16 colors. The key is to think small and to think what will be viewable at the smaller size.

A great site for more info is: http://www.favicon.com. It has a great explanation of what favicon.ico are and an online editor that allows you to save the created graphic to your computer.