Archived - AAC and MP3 Codecs (music file formats) compared
This document explains differences in the AAC and MP3 codecs (music file formats) that can be used in iTunes.
AAC-encoded files sound as good as or better than MP3 files encoded at the same or even a higher bit rate.
For example, a 128-kilobit-per-second (kbit/s) AAC file should sound as good as or better than a 160 kbit/s MP3 file. Because the bit rate is lower, the AAC file will also be smaller than the MP3 file. AAC files allow you to store the most music on your hard disk or iPod. The High Quality AAC setting creates files that are usually less than 1 MB for each minute of music.
Note: AAC files encoded from a source other than the iTunes Store (such as an audio CD) work the same as an MP3 file encoded from the same source. No authorization is required to play or burn them. So, AAC files you encode in iTunes can be burned as many times as you want and the songs do not require authorization to play on multiple computers.