What is Fair Use?

Legal Definition
Fair use is a US legal doctrine that permits limited use of copyrighted material without acquiring permission from the rights holders. It is similar to the fair dealing doctrines used in some countries outside the United States. While according to the Supreme Court fair use is an affirmative defense, in Lenz v. Universal Music Corp., (the "dancing baby" case), the United States Court of Appeals for the Ninth Circuit concluded that fair use was not merely a defense to an infringement claim, but was an expressly authorized right, and an exception to the exclusive rights granted to the author of a creative work by copyright law. "Fair use is therefore distinct from affirmative defenses where a use infringes a copyright, but there is no liability due to a valid excuse, e.g., misuse of a copyright." Examples of fair use in United States copyright law include commentary, search engines, criticism, parody, news reporting, research, and scholarship. Although related, the limitations and exceptions to copyright for teaching and library archiving in the U.S. are located in a different section of the statute. Fair use provides for the legal, unlicensed citation or incorporation of copyrighted material in another author's work under a four-factor balancing test.

The term "fair use" originated in the United States. A similar-sounding principle, fair dealing, exists in some other common law jurisdictions but in fact it is more similar in principle to the enumerated exceptions found under civil law systems. Civil law jurisdictions have other limitations and exceptions to copyright.

Fair use is one of the traditional safety valves intended to balance the interests of copyright holders with the public interest in the wider distribution and use of creative works by allowing certain limited uses that might otherwise be considered infringement.
-- Wikipedia
Legal Definition
This term applies to the legal using of material that is copyrighted and no payment of royalties is required.