MP3 Audio quality

When performing lossy audio encoding, such as creating an MP3 file, there is a trade-off between the amount of space used and the sound quality of the result. Typically, the creator is allowed to set a bit rate, which specifies how many kilobits the file may use per second of audio, for example, when ripping a compact disc to this format. The lower the bit rate used, the lower the audio quality will be, but the smaller the file size. Likewise, the higher the bit rate used, the higher the quality, and therefore, larger the resulting file will be.
Files encoded with a lower bit rate will generally play back at a lower quality. With too low a bit rate, "compression artifacts" (i.e., sounds that were not present in the original recording) may be audible in the reproduction. Some audio is hard to compress because of its randomness and sharp attacks. When this type of audio is compressed, artifacts such as ringing or pre-echo are usually heard. A sample of applause compressed with a relatively low bitrate provides a good example of compression artifacts.
Reference : http://en.wikipedia.org/wiki/Mp3