Direct Stream Digital. Different than the PCM system. DSD uses a single bit but samples it 2.800.000 times a second to generate audio. For example, a 24-bit 96kHz file contains 24 bits and is sampled 96.000 times a second. This has been used since CD’s (16-bit/44.1kHz).
DSD is used by Super Audio CD. A ‘standard’ DSD file or referred to as DSD64 is roughly equivalent to 24-bit 88.2 kHz. ‘Double DSD’ or DSD128 samples that single bit 5.600.000 times a second and give an equivalent of 24-bit 176kHz, those are sample rates that can be reproduced by formats that are not DSD. So DSD is not ‘better’. The reason that it might sound better only causes studios that specialize in DSD might also focus on higher quality recording.