The JPEG image format is best used to compress
24 bit color images
with a smooth
gradient. Sources of such images would include
scanners,
digital cameras, and high quality image renders that
uses a method such as
ray tracing or other methods that produce
realistic looking images.
JPEG handles things such as sharp lines and sudden color changes
very poorly. An image containing these will compress poorly and will
have a large number of JPEG artifacts. If the image also has very
few colors, it would have been better off as a gif.
JPEG is one of the three accepted formats for world wide web images. (Other formats work too, but these are the most well supported.)