From W3C’s “Architecture of the World Wide Web, Volume One“:
XML defines textual data formats that are naturally suited to describing data objects which are hierarchical and processed in a chosen sequence. It is widely, but not universally, applicable for data formats; an audio or video format, for example, is unlikely to be well suited to expression in XML. Design constraints that would suggest the use of XML include:
1. Requirement for a hierarchical structure.
2. Need for a wide range of tools on a variety of platforms.
3. Need for data that can outlive the applications that currently process it.
4. Ability to support internationalization in a self-describing way that makes confusion over coding options unlikely.
5. Early detection of encoding errors with no requirement to “work around” such errors.
6. A high proportion of human-readable textual content.
7. Potential composition of the data format with other XML-encoded formats.
8. Desire for data easily parsed by both humans and machines.
9. Desire for vocabularies that can be invented in a distributed manner and combined flexibly.