Are MP3 Files Legal?

The MP3 format is simply a type of compression scheme used to compress digital audio, so MP3 itself is completely legal. However, when people normally speak of the legality of MP3, they are really speaking of the legality of the audio that has been compressed using the MP3 scheme, not the MP3 format itself.

It is as legal to have an MP3 compressed audio file as it is to have a purchased music CD in your home, as long as you've been granted permission to download and play the audio file by the copyright holder.

It is also legal to copy and compress your audio CDs to MP3 files for your own personal use, after all it is your music; however it is illegal to encode MP3s and trade them with other people without permission to do so.

In October 2007, a jury found a Minnesota woman liable for copyright infringement for sharing music online and imposed a penalty of $222,000 in damages.