What is Favicon.ico?

A favicon (short for "Favorites icon"), also known as a page icon , is a small icon that is used by some browsers to identify a bookmarked Web site.

If you're trying to entice people return to your site from the Explorer's Favorites menu, it helps to prompt them with a special logo of some kind.

The display size of a favicon in the Favorites list is 16x16. Files are recognized by the " .ico " extension. It works in Explorer 5 and above, and new other browsers also have the ability to use the favicon.ico file.
Creating favicon.ico can save your site some bandwidth if you have created a custom "404 File Not Found error" file - that file will be sent by your web server everytime there is a request for a nonexistent "favicon.ico" file.

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