Activate this option to include (or embed) all media associated with your scene in the FBX file itself. For example, texture images.
Activate the Embed Media option to make the Maya FBX plug-in include (embed) associated media (textures, for example) within the FBX file, which it then extracts to an .FBM folder at import. The Maya FBX plug-in copies the embedded media to a <fileName>.fbm folder in the same location as the FBX file and is named after the FBX file. Since this media is contained within the FBX file itself, this has an impact on file size. Therefore, use this option only when you transport an FBX file to a location where the original media source is no longer accessible by the receiver.
When you import an FBX file with embedded media, the embedded files extract to a folder in the same location as the FBX file. If you do not have write permission to create that new folder, the media files are Imported to the user's temp folder, such as C:\Documents and Settings\<username>\Local Settings\Temp.
If you disable the Embed Media option, the Maya FBX plug-in stores the relative and absolute paths of the associated media files at export time. This causes problems if, for some reason, the path is no longer accessible. Make sure that the associated media is accessible to ensure the proper import of these media files.
If you export your file in ASCII format in FBX versions 2010 and earlier, no textures are embedded. See Type.
Embed your media to ensure that all your textures are carried over and loaded when you open the FBX file on another computer. You do not need to do this if you are working on a local machine or over a network database that ensures that the paths to media are not changing.