1. Short for COmpression / DECompression, a codec is an algorithm or special computer program that reduces the number of bytes consumed by large files. Codecs are often used with videos distributed over the Internet; codecs enable what would normally be a very large video file to be much smaller. Users familiar with MP3 audio files can think of a Divx or XviD codec as the MP3 of videos.
2. In communication, a codec is short for coder/decoder. A codec is a chip that decodes analog-to-digital conversion and digital-to-analog.
To resolve many issues related to a codec, users should download the latest codec from either the media player provider or from the developer of the video or audio file being played.
Microsoft Windows 2000 and XP users can view the audio and video codecs installed on their computer by opening the Sound, video, and game controllers category in the Device Manager.
Where to get codecs?
One of our most recommended codec pack is the CCCP also known as the Combined Community Codec Pack you can find this download on their web page.
In addition to the above recommendation Free-Codecs.com has another great all in one codec package available under Codec Pack All in 1.
Finally, a great list of hundreds of different codecs is found on fourcc.