Historically, file name extensions have had different technical specifics across different file systems and different operating systems. Today, file name extensions are essentially the last few characters of a file name after a dot.
For a file named filename.ext, ext is the extension. File name extensions will typically give you a clue as to the type of the file. For example, a file with a txt extension is likely a plain text file. Windows uses file name extensions to determine what program should open a file and what icon to give it.
To see this in action, first verify that you have Windows set to display extensions (they’re hidden from you by default). You’ll find instructions for doing so, half way down this page.
Now, click Start and then Run…, type notepad and then click OK. Type some random text and then from File at the top, select Save As… Call the file whatever you want and save it to your Desktop. I called mine, myfile.txt (imaginative huh?). Now close notepad. Find the file on your Desktop and notice that its icon is a little note pad. If you double click the file, it will open for you in Notepad.
Now, right click the file and click Rename. Arrow over to the right and add .mp3 to the end. You will get a warning about changing the extension. Click Yes. You will notice that the icon has now changed to a music note or something sound related. Windows now believes this is a sound file of some sort. If you double click the file, Windows will try to open it with your default program for listening to music, and you’ll probably get some error messages.
Get rid of any error messages, close your music program, and delete the file. This demonstration has concluded.
Filename extension – Wikipedia article
OpenWith.org – Free programs to open any file extension