Before an XML parser can read a document, it must know which character set and encoding the document uses. In some cases, external metainformation tells the parser what encoding the document uses. For instance, an HTTP header may include a Content-type header like this:
Content-type: text/html; charset=ISO-8859-1
However, XML parsers generally can't count on the availability of such information. Even if they can, they can't necessarily assume that it's accurate. Therefore, an XML parser will attempt to guess the character set based on the first several bytes of the document. The main checks the parser makes include the following:
If the first two bytes of the document are #xFEFF , then the parser recognizes the bytes as the Unicode byte-order mark . It then guesses that the document is written in the big-endian, UTF-16 encoding of Unicode. With that knowledge, it can read the rest of the document.
If the first two bytes of the document are #xFFFE , then the parser recognizes the little-endian form of the Unicode byte-order mark. It now knows that the document is written in the little-endian, UTF-16 encoding of Unicode, and with that knowledge it can read the rest of the document.
If the first four bytes of the document are #x3C3F786D , that is, the ASCII characters <?xm , then it guesses that the file is written in a superset of ASCII. In particular, it assumes that the file is written in the UTF-8 encoding of Unicode. Even if it's wrong, this information is sufficient to continue reading the document through the encoding declaration and find out what the character set really is.
Parsers that understand EBCDIC or UCS-4 may also apply similar heuristics to detect those encodings. However, UCS-4 isn't really used yet and is mostly of theoretical interest, and EBCDIC is a legacy family of character sets that shouldn't be used in new documents. Neither of these sets are important in practice.