I am using OS X Mountain Lion and I have this .avi file but not able to read. What is missing in my setup and what other file do I need to download to enable me to read? I can read mp4 files though.

I would reccommend that you install MPlayerX from the appstore. It reads any media file, I've tried. Quick time can't read .avi files as far as I know.

Quicktime doesn't have the codecs to read a lot of video files. I highly recommend you download VLC Player. Many other users on this forum would recommend VLC over all other options.

I use VLC and it's works just fine!

Here is a link: https://itunes.apple.com/en/app/mplayerx/id421131143?mt=12

I agree that VLC is also a good choice but MPlayerX is more user friendly.