Microsoft's upcoming productivity software suite, Office 2007, will bring about a change to the traditional file formats. While every version of Office prior was based off of 3 character file extensions, Office '07 will utilize 4 character file extensions. For example, documents will now be .docx, powerpoints will be .pptx and excel speadsheets will be .xlsx. Noticing a trend here? They are adding an x to the end of every file format.
Take a look at the whole list of file extensions at AviransPlace. The extra character denotes Office 2007's reliance upon XML technology being used in the files, and probably some desperation to show consumers that they have actually changed something in this version. However, I don't think it is particularly wise to move into the 4 character file extensions region. The industry standard has pretty much been 3 character file extension, with the exception of programming languages such as .c and .java. Unfortunately, due to this change not all file formats are backwards compatible. Most only work back to Office 2000 so if you are still on Office 98, Microsoft will want you to upgrade.