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MPEG-4 SLS, or MPEG-4 Scalable to Lossless as per ISO/IEC 14496-3:2005/Amd 3:2006 (Scalable Lossless Coding), is an extension to the MPEG-4 Part 3 (MPEG-4 Audio) standard to allow lossless audio compression scalable to lossy MPEG-4 General Audio coding methods (e.g., variations of AAC). It was developed jointly by the Institute for Infocomm Research (I2R) and Fraunhofer, which commercializes its implementation of a limited subset of the standard under the name of HD-AAC. Standardization of the HD-AAC profile for MPEG-4 Audio is under development (as of September 2009).
MPEG-4 SLS allows having both a lossy layer and a lossless correction layer similar to Wavpack Hybrid, OptimFROG DualStream and DTS-HD Master Audio, providing backwards compatibility to MPEG AAC-compliant bitstreams. MPEG-4 SLS can also work without a lossy layer (a.k.a. "SLS Non-Core"), in which case it will not be backwards compatible, Lossy compression of files is necessary for files that need to be streamed to the Internet or played in devices with limited storage.
With DRM, ripping of the lossless data or playback on non DRM-enabled devices could be disabled.
MPEG-4 SLS is not related in any way to MPEG-4 ALS (Audio Lossless Coding).