ASCII (American Standard Code for Information Interchange) uses 7-bit numbers to represent characters. This gives us 27 or 128 possible characters. 33 characters are reserved as control characters like RETURN or TAB leaving 95 printable characters starting with the SPACE character.
As you can see from the table, ASCII is used for text-only files such as those opened by Windows Notepad.
Before ASCII became the dominant text format several other character representations were used. EBCDIC was particularly common as it was used on the mainframe computers made by IBM, the dominant computer company from the 1950s to the 1980s.