SubRip is one of the more popular text-based subtitle formats. Since most subtitles are still ripped from DVDs they must be created using OCR. Although SubRip was the first program with the ability to create SRT subtitle files, VobSub can also make them. Whatever application you use, you should expect to spend at least a little bit of time tweaking the settings to get the most accurate results possible. You may also need to go through the text to manually correct areas where the OCR engine simply made the wrong choice.
SRT subtitles are most commonly found in DivX or XviD encoded AVI files.