Where PSD came from
PSD is Photoshop's native document format, essentially unchanged in structure since 1990. It stores every layer, mask, adjustment, smart object and channel separately so the edit stays live and non-destructive. That is what makes it a working format rather than a delivery format, and why a PSD is routinely a hundred times the size of the image it produces.
The technical picture
Compression: Lossless RLE or ZIP per layer. Transparency: Full alpha plus layer masks. Animation: Timeline frames supported. Colour: 8-bit, 16-bit and 32-bit per channel, CMYK, Lab. Typical file size relative to WebP: often 10-100x larger than WebP — every layer is stored separately.
Where it opens
Photoshop and a handful of compatible editors. This is usually the deciding factor when choosing between PSD and WebP — WebP renders in every browser but is uneven in desktop software, while PSD has a very different support profile.
Converting PSD to WebP
PSD is a working file, not something you publish. Flattening to WebP produces the deliverable — typically a fraction of a percent of the source size. Layers, masks and adjustments are flattened on the way to WebP and cannot be recovered. Keep the PSD as the editable master.
Converting WebP to PSD
Converting WebP to PSD gives you a proper layered Photoshop document with the image on an unlocked base layer — ready for retouching, text overlays and adjustment layers. Photoshop can open a WebP directly only since 23.2, and even then it lands as a flat locked background. Expect the PSD output to be often 10-100x larger than WebP — every layer is stored separately — that difference is the price of getting a format the destination will actually accept.