MPEG-2 is stemmed out of the shortcomings of MPEG-1, which hold below disadvantages:

1. An audio compression system limited to two channels (stereo.)

2. No standardized support for interlaced video with poor compression when used for interlaced video

3. Only one standardized 'profile' which was unsuited for higher resolution video. MPEG-1 could support 4k video but there was no easy way to encode video for higher resolutions, and identify hardware capable of supporting it, as the limitations of such hardware were not defined.

4. Support for only one color space, 4:2:0.

MPEG-2 is widely used as the format of digital television signals that are broadcast by terrestrial (over-the-air), cable, and direct broadcast satellite TV systems. It also specifies the format of movies and other programs that are distributed on DVD (Learn to Convert DVD to MPEG2) and similar discs. As such, TV stations, TV receivers, DVD players, and other equipment are often designed to this standard. MPEG-2 was the second of several standards developed by the Moving Pictures Expert Group (MPEG) and is an international standard (ISO/IEC 13818). Parts 1 and 2 of MPEG-2 were developed in a joint collaborative team with ITU-T, and they have a respective catalog number in the ITU-T Recommendation Series.

While MPEG-2 is the core of most digital television and DVD formats, it does not completely specify them. Regional institutions can adapt it to their needs by restricting and augmenting aspects of the standard.

Filename extensions of MPEG2: .mpg, .mpeg, m2v, .mp2, mp3 are some of a number of filename extensions used for MPEG-1 or MPEG-2 audio and video file formats.

MPEG2 Systems: MPEG-2 includes two Systems section. One is the MPEG transport stream, designed to carry digital video and audio over possibly lossy media, where the beginning and the end of the stream may not be identified, such as broadcasting or magnetic tape, examples of which include ATSC, DVB, SBTVD and HDV. MPEG-2 Systems also defines the MPEG program stream, a container format designed for file-based media such as hard disk drives, optical discs and flash memory.