Why would a static nested interface be used in Java?

The static keyword in the above example is redundant (a nested interface is automatically "static") and can be removed with no effect on semantics; I would recommend it be removed. The same goes for "public" on interface methods and "public final" on interface fields - the modifiers are redundant and just add clutter to the source code.

Either way, the developer is simply declaring an interface named Foo.Bar. There is no further association with the enclosing class, except that code which cannot access Foo will not be able to access Foo.Bar either. (From source code - bytecode or reflection can access Foo.Bar even if Foo is package-private!)

It is acceptable style to create a nested interface this way if you expect it to be used only from the outer class, so that you do not create a new top-level name. For example:

public class Foo {
    public interface Bar {
        void callback();
    }
    public static void registerCallback(Bar bar) {...}
}
// ...elsewhere...
Foo.registerCallback(new Foo.Bar() {
    public void callback() {...}
});

The question has been answered, but one good reason to use a nested interface is if its function is directly related to the class it is in. A good example of this is a Listener. If you had a class Foo and you wanted other classes to be able to listen for events on it, you could declare an interface named FooListener, which is ok, but it would probably be more clear to declare a nested interface and have those other classes implement Foo.Listener (a nested class Foo.Event isn't bad along with this).

Member interfaces are implicitly static. The static modifier in your example can be removed without changing the semantics of the code. See also the the Java Language Specification 8.5.1. Static Member Type Declarations

An inner interface has to be static in order to be accessed. The interface isn't associated with instances of the class, but with the class itself, so it would be accessed with Foo.Bar, like so:

public class Baz implements Foo.Bar {
   ...
}

In most ways, this isn't different from a static inner class.

Jesse's answer is close, but I think that there is a better code to demonstrate why an inner interface may be useful. Look at the code below before you read on. Can you find why the inner interface is useful? The answer is that class DoSomethingAlready can be instantiated with any class that implements A and C; not just the concrete class Zoo. Of course, this can be achieved even if AC is not inner, but imagine concatenating longer names (not just A and C), and doing this for other combinations (say, A and B, C and B, etc.) and you easily see how things go out of control. Not to mention that people reviewing your source tree will be overwhelmed by interfaces that are meaningful only in one class.So to summarize, an inner interface enables the construction of custom types and improves their encapsulation.

class ConcreteA implements A {
 :
}

class ConcreteB implements B {
 :
}

class ConcreteC implements C {
 :
}

class Zoo implements A, C {
 :
}

class DoSomethingAlready {
  interface AC extends A, C { }

  private final AC ac;

  DoSomethingAlready(AC ac) {
    this.ac = ac;
  }
}

Why would a static nested interface be used in Java?

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