Excel actually mostly ignores the extension and relies on heuristics to detect the file type on load. Many web applications used to implement "XLS export" by writing out CSV file with .xls extension.

This magic detection of file type has one unfortunate side effect: it is not exactly obvious how to convince Excel to load plain text data that is not CSV with delimiters from the current locale. (which is major PITA with most European locales where Excel uses "Semicolon"-SV and not "Comma"-SV but still calls it CSV)