A transparent GIF (Graphics Interchange Format) is an image file that has one color assigned to be "transparent" so that the assigned color will be replaced by the browser's background color, whatever it may be. Pretend, for example, that you have created a rectangular GIF image of a large red star on a white background. If you are only interested in having the red star appear on your Web page, and don't want to see the white background, you can transparentize the white background color so that it changes to whatever the Web page's background color is (yellow, for example). Then, when you view the Web page, you will only see a red star on a yellow background.
A single color transparent GIF can also be used as a place holder in a table cell on a Web page. Another name for this use of a transparent GIF is "spacer GIF".