PSD

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PSD, which stands for "Photoshop Document", is a proprietary file format which can be created using Adobe Photoshop. According to the game files and other assets leaked on Valve servers, Valve used Photoshop to edit or create games textures, for games such as Team Fortress 2.

In Source 2009, VTEX added support for converting PSD files to VTF directly, without exporting to TGA first.

For more information about this file format, visit the  Wikipedia article.