The DirectDraw Surface container file format (uses the filename extension DDS), is a Microsoft format for storing data compressed with the previously proprietary S3 Texture Compression (S3TC) algorithm, which can be decompressed in hardware by GPUs. This makes the format useful for storing graphical textures and cubic environment maps as a data file, both compressed and uncompressed.
en.wikipedia.org/wiki/DirectDraw_Surface
The DDS format was developed by Microsoft to be used with the DirectX SDK for the development of real-time rendering applications, particularly 3D games. The format is primarily used to store model textures, mipmap levels, and cubemaps in 3D video games.