A character set is a collection of symbols that represent the printable characters of a language. There are many standard character sets in use today. The correct character set choice for a message will depend on its language and on which character set is likely to be supported by the mail clients that your message recipients will use. Some languages are supported by multiple character sets and some character sets might be used for multiple languages. Additionally, your operating system, web browser and/or text editor will help determine which character set would be used to compose a message. Also, you should be sure that your recipients are likely to have that character set installed on their systems and that their email client is capable of using alternate character sets. Note that some web-based email clients may not support international character sets.
Extended characters are characters beyond the standard 7-bit ASCII characters. These are the characters that usually differ between character sets. The 7-bit ASCII characters are part of most character sets used for email messages and web pages.
Encoding is used to convert an 8-bit message into a 7-bit message. Most English language messages only use 7-bit characters. 8-bit characters are used for special symbols and additional characters for other languages. Since it is possible that someone may be using an older mail server that cannot handle 8-bit messages properly, messages that include 8-bit characters are often encoded to 7-bits using either quoted-printable or base64 encoding methods. This is not a requirement though.
The quoted-printable encoding is used when the majority of the characters in a message can be represented by 7-bits. In this case, only the 8-bit and certain 7-bit characters are encoded making the encoded message body mostly readable. If the message contains a significant number of 8-bit characters, base64 encoding might be more space efficient.