Squashfs is a highly compressed read-only filesystem for Linux (kernel 2.4.x). It uses Gzip compression to compress files, inodes and directories. Inodes in the system are very small and all blocks are packed to minimise data overhead. Block sizes greater than 4K are supported up to a maximum of 64K.

Version 3.2 of squashfs released in January, 2007.

http://squashfs.sourceforge.net/