A proprietary file format is developed and controlled by a specific software company or organization. Unlike open standards, the internal specifications defining how the data is structured and stored are not publicly documented. Accessing and interpreting files in these formats typically requires the originating vendor's software or software licensed by them, as independent developers cannot freely implement support due to the secrecy.

Common examples include Microsoft's .docx (Word documents) and .xlsx (Excel spreadsheets), requiring Microsoft Office or compatible licensed viewers. Another example is Adobe's .psd (Photoshop documents), primarily editable within Adobe Photoshop itself, despite some limited support in other tools. These formats are heavily used in office productivity, creative design, and specific industries like CAD (e.g., AutoCAD .dwg).

Key advantages include vendor control for optimization and feature integration. However, significant limitations exist: potential vendor lock-in, where users become reliant on specific software; difficulty in long-term archival if the vendor software becomes obsolete; and restricted accessibility and interoperability, hindering collaboration unless everyone uses the same tools. This often leads to preference for open standards in multi-vendor environments.