potrace(TM) is a utility for tracing a bitmap, which means, transforming a bitmap into a smooth, scalable image. The input is a bitmap (PBM, PGM, PPM, or BMP format), and the default output is an encapsulated PostScript file (EPS). A typical use is to create EPS files from scanned data, such as company or university logos, handwritten notes, etc. The resulting image is not "jaggy" like a bitmap, but smooth. It can then be rendered at any resolution.
Potrace can currently produce the following output formats: EPS, PostScript, PDF, SVG (scalable vector graphics), Xfig, Gimppath, and PGM (for easy antialiasing). Additional backends might be added in the future.
mkbitmap is a program distributed with Potrace which can be used to pre-process the input for better tracing behavior on greyscale and color images. See the mkbitmap examples page.
$ potrace --svg input.pnm