License compatibility refers to the problem with licenses applied to works subject to copyright, particularly licenses of software packages, which can contain contradictory requirements, rendering it impossible to combine source code from such packages or content from such works in order to create new works.[1]
For example, suppose one license says "modified versions must mention the developers in any advertising materials", and another license says "modified versions cannot contain additional attribution requirements". If someone combined a software package which uses one license with a software package which uses the other, it would be impossible to legally distribute the combination without direct permission from the copyright holders for both packages because the two requirements cannot be simultaneously fulfilled. Thus, these two packages would be license-incompatible.[2]
Not all licenses approved by OSI or by the Free Software Foundation are compatible with each other, thus not all the code under OSI or FSF approved licenses can be mixed. For example new software which mixes code released under the Mozilla Public License with code under the GNU General Public License (both licenses are OSI and FSF approved) cannot be distributed in a way which does not violate the terms of the GPL or the MPL. The FLOSS License Slide shows if some common licenses are compatible.
David A. Wheeler has argued that GPL compatibility is an important feature of software licenses.[3] Many of the most common free software licenses, such as the original MIT/X license, BSD licenses (in the three-clause and two-clause forms, though not the original four-clause form), and the LGPL, are "GPL-compatible". That is, their code can be combined with a program under the GPL without conflict (the new combination would have the GPL applied to the whole). When it comes to copyleft software licenses, they are not inherent GPL-compatible but some has exception clauses that allows combining software that is under different licenses or license versions.[4]