From within an Office application, type "MDI" in the Help pane, and you will
find the following explanation:
What is document imaging?
Document imaging is the process of scanning paper documents, converting them
to digital images that are then stored on CD, DVD, or other magnetic
storage. With Microsoft Office Document Imaging, you can scan paper
documents and convert them to digital images that you can save in Tagged
Image File Format (TIFF) (Tagged Image File Format (TIFF): A
high-resolution, tag-based graphics format. TIFF is used for the universal
interchange of digital graphics.) or Microsoft Document Imaging Format (MDI)
(Microsoft Document Imaging Format (MDI): A high resolution, tag-based
graphics format, based on the Tagged Image File Format (TIFF) used for
digital graphics.) to your computer's hard disk, network server, CD, or DVD.
Microsoft Office Document Imaging also gives you the ability to perform
optical character recognition (OCR) (OCR: Translates images of text, such as
scanned documents, into actual text characters. Also known as text
recognition.) either as part of scanning a document, or while you work with
a TIFF or MDI file. By performing OCR, you can then copy recognized text
from a scanned image or a fax into a Microsoft Word document or other Office
program file.