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PNG compression itself never discards image data. Reducing the number of colors in a PNG is a separate step, and that step can change pixel values. The file format is lossless; a palette reduction is a quantization decision that you make before or during encoding.

Why the two claims don’t conflict

The PNG format, defined in the W3C Portable Network Graphics (PNG) Specification (Third Edition), compresses image data with a lossless method. Whatever pixel values go into the encoder come back out unchanged when the file is decoded. That guarantee covers the compression stage only.

Palette reduction happens earlier. When an image with many colors is mapped to a smaller set of colors, some original pixels must take a different color. Once that mapping is done, the lossless compressor faithfully preserves the reduced image, including its changes. So a PNG can be lossless in the file-format sense and still look different from the photograph it started as.

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What an indexed-color PNG actually stores

PNG supports several color types: grayscale, truecolor (red, green, and blue samples), grayscale with alpha, truecolor with alpha, and indexed color. Indexed color is the type that uses a palette.

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In an indexed-color PNG, each pixel stores an index that points to an entry in a palette. The palette entries hold the actual colors, and each entry uses 8-bit samples. The bit depth recorded for the image counts the bits in each index, not the precision of the colors in the palette. The specification permits index depths of 1, 2, 4, or 8 bits, which sets a hard ceiling on how many palette entries an image can address:

Index bit depth Maximum palette entries addressable Typical use
1 bit 2 Simple two-tone artwork, line drawings
2 bits 4 Very limited color sets
4 bits 16 Small icons, simple graphics
8 bits 256 Most palette-based images

The maximum counts follow directly from the index size: 2 to the power of the bit depth. An image that needs more distinct colors than its index depth allows cannot be stored as indexed color without reduction.

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When a palette conversion is exact

Conversion to an indexed image is lossless only when every color the source uses fits into the palette. If an image has 200 distinct colors and you encode it with an 8-bit index, all 200 can be stored exactly. The output is then pixel-for-pixel identical to the source.

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The test is therefore a count of distinct colors, not the appearance of the image. A flat logo, a chart with a fixed color scheme, or a screenshot of a limited interface often meets the condition. A photograph usually does not. Once the distinct-color count exceeds the palette capacity, at least some pixels must change.

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What quantization changes

When the palette is too small, an encoder chooses a set of representative colors and maps each source pixel to the nearest one. The choice of representatives and the mapping rule both affect the result, and they vary between tools. Two encoders given the same settings can produce different palettes.

The visible effect depends on the image. Smooth gradients, such as skies, skin tones, and soft shadows, are the most likely to show banding, where a continuous change turns into visible steps between flat bands of color. Detailed photographs may lose subtle tones without an obvious pattern. Flat graphics with few colors typically change little if the palette covers their colors.

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Dithering: smoother gradients, more grain

Dithering arranges pixels of nearby palette colors so that the eye averages them into an intermediate tone. The W3C specification notes that dithering is recommended for photograph-like imagery to reduce contour artifacts, and it also warns that dithering may produce graininess. In practice, dithering trades a visible step for a visible texture. Whether that trade is an improvement depends on the image and on how close the viewer is to it.

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File size: no fixed reduction is guaranteed

Reducing the palette often makes a file smaller, because each pixel carries a smaller index and the palette stores fewer entries. However, the specification does not publish a general size saving, and the actual result depends on the image content and the encoder. A gradient with dithering may compress worse than the same gradient without it, because the added pattern is harder to compress. Measure the output of your own image rather than assuming a reduction.

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How to check whether your conversion changed the image

  1. Keep the original, truecolor version of the image as the reference.
  2. Convert it to indexed color with your chosen palette size and dithering setting, and save the result as a new file.
  3. Compare the two images with a pixel-difference tool or a side-by-side view at 100 percent zoom. Pay attention to gradients and to any edge where colors meet.
  4. If the differences are not acceptable, increase the palette size, switch dithering off or on, or keep the image in a truecolor PNG.

Practical rules

  • A PNG that you encode from a source using fewer distinct colors than the palette holds is exact.
  • Reducing an image with more colors than the palette holds is quantization, and it changes pixels.
  • Keep an unreduced master file if you may need the original colors later, because a reduced PNG cannot recover the colors it discarded.
  • Choose the palette size and dithering setting by looking at the output of the actual image, not by a general rule.

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