Adobe Illustrator is a leading VECTOR art program (in other words, it records it's graphic data using mathematical formulas).  This means you can draw a logo very small and enlarge it to any size, and it will be perfectly clear.  In comparison, raster programs can enlarge an image size but becomes very pixilated (you see the tiny squares that make up the image, and it's not clear).

Illustrator is a staple to the professional graphic designer’s toolbox.

Illustrator File Preparation:
- We accept ALL V9.0 and Newer Adobe Illustrator .eps files.
- Convert all fonts to outlines before sending. 
- Make sure you include and 1/8” bleed.
- Leave a 1/8” of safety.
- CMYK color space.

Helpful Resources:
- Purchase Illustrator from Adobe here.
- Get help from the online community here.

A nice summary by Wikipeida.org: (http://en.wikipedia.org/wiki/Adobe_Illustrator)

History
Adobe Illustrator was first developed for the Apple Macintosh in 1986 (shipping in January 1987) as a logical commercialization of Adobe's in-house font development software and PostScript file format.

Initial release
In many ways Illustrator's release was a gamble: the Macintosh did not have high market share, the only printer that could output Illustrator documents was Apple's own LaserWriter (also very new and expensive), and the drawing paradigm of Bézier curves was novel to the mainstream user. Not only did the Macintosh show only monochrome graphics, but also display options were basically limited to its built-in 9" monitor. Illustrator helped drive the development of larger monitors for the Macintosh.  Illustrator was a reliable, capable product, however, and its relatively steep learning curve let users quickly appreciate that the new paradigm was not only better, but finally solved the problem of imprecision from existing programs like MacDraw. It also provided a tool for people who could neither afford nor learn high-end software such as AutoCAD. Illustrator successfully filled a niche between painting and CAD programs.

Illustrator's power and simplicity derive from the choice of Bézier curves as the primary document element. A degenerate curve provides a line, and circles and arcs (trigonometric shapes) can be emulated closely enough. In a novel twist, Adobe also made Illustrator documents true PostScript files -- if one wanted to print them, one could send them directly to a PostScript printer instead of printing them from Illustrator. Since PostScript is a readable text format, third-party developers also found it easy to write programs that generated Illustrator documents.

Adobe was willing to take risks with Illustrator's user interface. Instead of following Apple's UI guidelines to the letter or imitating other popular Macintosh programs, they made it possible to switch between the various navigation tools (i.e, Zoom and Pan) using various keyboard key combinations. Probably from Adobe's past experience in-house, it knew what it was doing, and the majority of users vindicated the design as "slick." Unfortunately, Apple later chose one of the key combinations (Command-Space) as the keyboard layout changer, and Windows treated another (the Alt key) as a system key.

Versions 2–5
Although Adobe developed Illustrator primarily for the Macintosh during its first decade, it sporadically supported other platforms. In the early 1990s, Adobe released versions of Illustrator for NeXT, Silicon Graphics IRIX, and Sun Solaris platforms, but they were discontinued due to poor market acceptance. The first version of Illustrator for Microsoft Windows, version 2.0, was released in early 1989, but it was a flop. The next Windows version, version 4.0, was widely criticized as being too similar to Illustrator 1.1 instead of the Macintosh 3.0 version, and certainly not the equal of Windows' most popular illustration package CorelDraw. (Note that there were no versions 2.0 or 4.0 for the Macintosh.) Version 4 was, however the first version of Illustrator to support editing in preview mode, which did not appear in a Macintosh version until 5.0 in 1993.

Versions 6–7
With the introduction of Illustrator 6 in 1996, Adobe made critical changes in the user interface with regards to path editing (and also to converge on the same user interface as Adobe Photoshop), and many users opted not to upgrade. To this day, many users find the changes questionable. Illustrator also began to support TrueType, making the "font wars" between PostScript Type 1 and TrueType largely moot. Like Photoshop, Illustrator also began supporting plug-ins, greatly and quickly extending its abilities.
With true ports of the Macintosh versions to Windows starting with version 7 in 1997, designers could finally standardize on Illustrator. Corel did port CorelDRAW 6.0 to the Macintosh in late 1996, but it was received as too little, too late. Aldus ported FreeHand to Windows but it was not the equal of Illustrator. Adobe bought Aldus in 1994 for PageMaker, and as part of the transaction it sold FreeHand to Macromedia.
With the rise of the Internet, Illustrator was enhanced to support Web publishing, rasterization previewing, PDF, and SVG.

Branding
Starting with version 1.0, Adobe chose to license Sandro Botticelli's "The Birth of Venus" from the Bettmann Archive and use the portion containing Venus' face as Illustrator's branding image. Warnock desired a Renaissance image to evoke his vision of Postscript as a new Renaissance in publishing, and Adobe employee Luanne Seymour Cohen, who was responsible for the early marketing material, found Venus' flowing tresses a perfect vehicle for demonstrating Illustrator's strength in tracing smooth curves over bitmap source images. Over the years, the rendition of this image on Illustrator's splash screen has become more stylized as Illustrator gains new features.

Versions CS–CS2
Adobe Illustrator is currently (as of April 2005) in version 12 (called CS2 to reflect its integration with Adobe's Creative Suite) and is available for both the Mac OS X and Microsoft Windows operating systems. The image of Venus was replaced in Illustrator CS (version 11) with a stylized flower to conform to the Creative Suite's nature imagery.

Among the new features included in Illustrator CS2 are Live Trace, Live Paint, a control palette, and custom workspaces. Live Trace allows for the conversion of bitmap imagery into vector art. Live Paint allows users more flexibility in applying color to objects, specifically those that overlap.
Additionally, two of the new features included with Adobe Illustrator CS-CS2 have been a new file format and a new text engine, both of which have drawn the ire of professional designers because of the fact that their "Legacy" (pre-CS format; Adobe's own moniker for such files) files will not open without some process of conversion. Illustrator CS-CS2 has also drawn a lot of fire amongst professionals for its performance issues involving the editing of text objects as well as subpar overall performance even on high-end workstations.

Version CS3
This version of Adobe Illustrator is scheduled to be released in Q2 2007. The Mac version will be a universal binary. All previous Mac versions on the program were PowerPC binaries, and were thus forced to run with the Rosetta emulator on Intel-based Macs. This emulation causes Adobe software to run slower in most cases or repeatedly crash on occasion. Adobe announced it would not release a Universal binary of CS2 because rewriting the code to be universal-compliant requires a major development effort. It is unknown what new features it will have.