In the large format printing world, there are two predominate types of inks that are used: Pigment and Dye. Based on what you will be printing, one type of ink may be preferable over another. Many large format inkjet printers such as Canon, Epson and HP use dye-based inks. Inkjet printers geared toward graphics-heavy and photo printing use pigment-based inks.
How are the inks different?
Pigment-based inks are mixture of dry pigment and a liquid such as water or oil. The pigment doesn't dissolve in the liquid, rather it stays suspended. Dye-based inks are mixed with water and dissolve completely.
During the printing process, both inks are sprayed out onto a given media. Pigment-based inks stay on top of the paper instead of being absorbed into it. Heat and pressure cause the liquid to evaporate and the color particles to bond to the surface of the paper. Dye-based inks also have heat and pressure applied but the ink is absorbed into the paper during the process.
What ink type is best?
Determining what type ink is best for you depends on what you're printing, what you're printing on and where or how your printed item will be used. Dye-based inks are water-soluble and the colors can run if they get wet (unless you are printing on special media). Dye-based inks are often brighter and more vibrant and lend themselves well for printing graphics-heavy items. Pigment-based inks don't fade as readily as dye-based and are more water resistant. Cost-wise, dye-based inks are generally cheaper that pigment-based inks.
In the end, when determining what type of ink is best, consider how much you're willing to spend on inks, what types of things you will be printing and what type of media you will be using. Once you narrow these items down, you can then select the ideal large format printer for you that uses the best inks for your printing needs.