MAME is strictly a non-profit project. Its main purpose is to be a reference to the inner workings of the emulated arcade machines. This is done both for educational purposes and for preservation purposes, in order to prevent many historical games from disappearing forever once the hardware they run on stops working. Of course, in order to preserve the games and demonstrate that the emulated behavior matches the original, you must also be able to actually play the games. This is considered a nice side effect, and is not MAME's primary focus.
It is not our intention to infringe on any copyrights or patents on the original games. All of MAME's source code is either our own or freely available. To operate, the emulator requires images of the original ROMs, CDs, or hard disks from the arcade machines, which must be provided by the user. No portions of the original game code are included in the executable.
MAME is free. Its source code is free. Selling either is not allowed.
ROM, CD, and hard disk images are all copyrighted material. They cannot be distributed without the explicit permission of the copyright owner. They are not "abandonware", nor have any of the games supported by MAME passed out of copyright.
MAME is not intended to be used as a tool for mass copyright infringement. Therefore, it is strongly against the authors' wishes to sell, advertise, or link to resources that provide illegal copies of ROM, CD, or hard disk images.
Derivative works are permitted under the MAME license. However, you are discouraged from providing specific functionality that goes against the philosophy of the MAME team. Specifically:
Because the name MAME is trademarked, you must abide by the rules of the trademark usage if you wish to use "MAME" as part of the name your derivative work. In general, this means you must request permission, which requires that you follow the guidelines above.
The version number of any derivative work should reflect the version number of the MAME release it was derived from.
For questions regarding the MAME license, trademark, or other usage, go to http://mamedev.org/.
MAME is a registered trademark of Nicola Salmoria.