Folk Music, in the original sense of the term, is music by and of the common people.
Folk music arose, and best survives, in societies not yet affected by mass communication and the commercialization of culture. It normally was shared by the entire community (and its performance not strictly limited to a special class of expert performers), and was transmitted by word of mouth.
During the 20th and 21st century, the term folk music took on a second meaning: it describes a particular kind of popular music which is culturally descended from or otherwise influenced by traditional folk music. Like other popular music, this kind of folk music is most often performed by experts and is transmitted in organized performances and commercially distributed recordings. However, popular music has filled some of the roles and purposes of the folk music it has replaced.
Folk music is somewhat synonymous with traditional music. Both terms are used semi-interchangeably amongst the general population; however, some musical communities that actively play living folkloric musics (see Irish traditional music for a specific example), have adopted the term traditional music as a means of distinguishing their music from the popular music called "folk music," especially the post-1960s "singer-songwriter" genre. (Courtesy of Wikipedia)
"The “E-B7” Folk Progression, which follows the Circle of Fifths movement, has been employed to write many folk songs dating back over a hundred years. Camptown Races, Alouette, and The Mexican Hat Dance as well as more recent hits such as The Beatles’ 1966 Yellow Submarine, Linda Ronstadt’s 1977 Blue Bayou and Elvis Presley’s 1977 Way Down were created around the Folk Progression." (Excerpt from Money Chords - A Songwriter's Sourcebook of Popular Chord Progressions © 2000 by Richard J. Scott) Three great examples of folk progressions are shown below in the key of C.