Sparse bundles defined
A sparse bundle is a disk image format introduced in Mac OS X 10.5 Leopard® (.sparsebundle). Like sparse images (.sparseimage), a sparse bundle is a Read/Write format where the disk image only occupies as much space as the data it contains, up to the limit defined when it was created. Sparse bundles compact more efficiently than sparse images, meaning that it is faster to reclaim the unused free space in a sparse bundle than in an equivalent sparse image.
While both sparse images and sparse bundles contain a file system, a sparse bundle is bundle-backed, meaning that it employs a specialized, hierarchical directory structure for grouping related resources. Within a sparse bundle, the bands subdirectory contains the actual data saved within the disk image.
Under Leopard, enabling FileVault® on a Home folder converts that Home folder into an encrypted sparse bundle. Under Mac OS X 10.4 Tiger® and earlier, FileVault employed encrypted sparse images.
Sparse bundles are documented sparsely in the man page for the hdiutil command.