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There are a number of systems for citing various materials (MLA, APA, etc.). These vary by discipline, country, journal, level of formality, and so on. Obviously one should know which system should be used for citing a particular source.

That said, when is it best to use the phrase "courtesy of..." when citing? If it isn't ever best, when is it acceptable?

If it matters, let's narrow the context to presentations/lectures.

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    The term indicates that permission to use the cited material has been requested and given. (Though in some cases the material may come with a blanket "permission to reprint" statement.) Note that in many cases someone else's published work may be quoted in part using the "fair use doctrine", so permission is only really needed when you quote substantial pieces of a work (but I'm not a lawyer and I'm not going to tell you what "substantial" means). – Hot Licks Nov 18 '15 at 23:38
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It's best when you've asked the owner of the rights to the material cited (literature, generally) or used (graphics, generally), and that owner has not only given permission but also asked you in return to use that particular phrase to credit the owner.

It's acceptable when you've asked the owner of the rights and the owner has given permission without specifying any particular phrase to use when giving the owner credit.

As requested, this answer omits mention of style guidelines from whatever source (MLA, APA, publishing house, journal, etc.). Where those exist and conflict with the phrasing you've asked about, of course the style guideline would take precedence.

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    What about material released in the public domain? In a sense, the authors of such works give permission in advance. Does one's use of the material change this? (Thanks!) – jvriesem Dec 2 '15 at 20:24
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    @jvriesem, as you say, if the material is in the public domain, the public owns it, so you can use it at will without permission. As a courtesy, source and attribution should still be given somewhere (if not in text, in a bibliography) if possible, along with a phrase along the lines of 'out of copyright' or 'public domain'. – JEL Dec 2 '15 at 20:40

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