Extending the correct answer from SigTerm, here is some background of why you got the effect you did for opening a PNG file in text mode:
The PNG format explains its 8-byte file header as follows:
The first eight bytes of a PNG file always contain the following values:
(decimal) 137 80 78 71 13 10 26 10
(hexadecimal) 89 50 4e 47 0d 0a 1a 0a
(ASCII C notation) \211 P N G \r \n \032 \n
This signature both identifies the file as a PNG file and provides for immediate detection of common file-transfer problems. The first two bytes distinguish PNG files on systems that expect the first two bytes to identify the file type uniquely.
The first byte is chosen as a non-ASCII value to reduce the probability that a text file may be misrecognized as a PNG file; also, it catches bad file transfers that clear bit 7.
Bytes two through four name the format. The CR-LF sequence catches bad file transfers that alter newline sequences. The control-Z character stops file display under MS-DOS. The final line feed checks for the inverse of the CR-LF translation problem.
I believe that in text mode, the call to fread() was terminated when it read the sixth byte which contains a Ctrl+Z character. Ctrl+Z was historically used in MSDOS (and in CPM before it) to indicate the end of a file, which was necessary because the file system stored the size of a file as a count of blocks, not a count of bytes.
By reading the file in text mode instead of binary mode, you triggered the protection against accidentally using the TYPE command to display a PNG file.
One thing you could do that would have helped diagnose this error is to use fread() slightly differently. You didn't test the return value from fread(). You should. Further, you should call it like this:
size_t nread;
nread = fread(buffer, sizeof(buffer), 1, f);
So that nread is a count of the bytes actually written to the buffer. For the PNG file in text mode, it would have told you on the first read that it only read 5 bytes.
Since the file cannot be that small, you would have had a clue that something else was going on. The remaining bytes of the buffer were never modified by fread(), which would have been seen if you initialized the buffer to some other fill value.
SOURCES: