The 20 GB PS3 could play PS2 games and so could the 60 GB model that was released with it and those machines are called the first generation PS3 Models. The second Generation PS3 model were the 60 GB Model and the 80 GB model and while they could play the PS2 games it was based on Partially software-based PS2 emulation while the earlier models were Hardware-based PS2 emulation. These 1st and 2nd generation PS3 models all included 4 USB ports and also had Flash memory card readers. The 3rd generation of PS3 models had the 40 GB, the 80 GB, and the 160 GB Harddrives but only 2 USB ports and do not play PS2 games with backward compatibility. The fourth Generation of PS3s are the 120 GB and 250 GB PS3 slim model which do not play PS2 games with Backward Compatibility. The current models in production with 160 GB and 320 GB harddrives also do not play PS2 game titles. All PS3 models play some titles of PlayStation 1 Games and do so through software emulation.
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NO ps2 games don't work in Ps1 only Ps1 games works on Ps2
With a emulator for the PS1
In order to play PS1 games on a PS2 you need to have a PS1 memory card in your PS2, so you can save your progress. Otherwise they don't work.
Yes if you have a Ps2 which can play both or, if you have a Ps1 you can only play the Ps1 game
No, but if you have one you can plug a PS1 memory card into a PS2 and save it on that