Unzipping is the act of extracting the files from a zipped single file or similar file archive. If the files in the package were also compressed (as they usually are), unzipping also uncompresses them.
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When you download programs from shareware or freeware companies on the Web, they almost always send you a zip file (the file name has a suffix of ".zip"). You can usually extract the files from a zipped file just by double-clicking on it since many archives include a "self-extracting" program. Several popular tools exist for zipping and unzipping: PKZIP in the DOS operating system, WinZip in Windows, and MacZip in Macintosh.