What is the XMP file?

Hi Everyone,
I transferred about 1,000 CR2 files from my card to my PC. I renamed all the images. This is the first time I have decided to rename my images. And this is the first time I ever noticed a small file, .XMP, with each image. Is the xmp file a result of my renaming? And do I need to keep them? If I delete them, am I loosing my exif data?

Thanks in advance,

Ruth

.XMP files are called sidecar files. Photoshop (or the like) creates them when working with RAW files. RAW files themselves are never altered - so all changes are written to this sidecar file. An alternative (with pros and cons) is for the changes to be recorded in a centralized database - then you never see the nuts and buts...