Data URI or plain Base64?
A data URI starts with something like data:image/png;base64, and can be used directly as an image source in HTML or a url() in CSS. Plain Base64 is just the encoded data, which APIs and JSON fields often expect.
When not to use Base64
Base64 images can't be cached separately and make the page that contains them larger. Keep it for small icons and email templates; link larger images as normal files.