A ".gz" file is a compressed file created by the gzip compression utility for Unix. The utility was written by Jean-loup Gailly, and the decompression code was written by Mark Adler. The files can be decompressed by Gunzip, which can also decompress files created by compress or pack.
Gzip was created as a replacement for the compress utility in Unix systems and is primarily intended to be used by the GNU Project. The DEFLATE algorithm is the basis for gzip, and the 1.3.3 version can compress files up to 2 gigabytes or larger. Gzip is designed to offer better compression and avoid difficulties with patented algorithms.