1. The fundamental unit of communication on the Internet. From Linux Guide @FirstLinux

2. All data sent across the Internet is broken up into packets, sent individually across the network, and reassembled back into the original data at the other end. Analogy: Imagine looking at an automobile freeway during rush hour from an airplane. The freeway looks like a flowing river, but each individual car (packet) is really independent from all the others. While it looks like the cars on the freeway are going in the same direction, each car really has its own source and destination separate from the others around it. This is how Internet core routes look. Analogy: Now consider that a bunch of coworkers leave the office and go to a party. Each gets in his/her own car and drives to the party. Each person may take a slightly route, but they all end up together at the party. This demonstrates how data is broken up into individual packets, sent across the Internet (potentially following different routes), then reassembled back again at the destination. Key point: Conceptually, networking occurs at abstract layers well above the concept of packets. Users type in a URL, and the file is downloaded. By dealing with the raw packets themselves, hackers are frequently able to subvert communications in ways not detectable at these higher layers. Contrast: The term "packet switched network (PSN)" is used to describe the Internet, whereas the term "circuit switched network (CSN)" is used to contrast it with the traditional phone system. The key difference is that in the phone system, the route between two people is setup at the start, and each bit in the stream follows that route. On the Internet, each packet finds its own route through the system, so during a conversation, the packets can follow different paths, and indeed arrive out-of-order. Another key difference is latency. The phone system forwards each bit one at a time, so as soon as one arrives, it doesn't have to wait before forwarding it on. On the Internet, bits are bunched together before transmission. Each hop must wait and receive all the bits before forwarding any of them on. Each hop therefore adds a significant amount of delay. Gamers know this as the "ping" time. Key point: There are other technologies that use packets, not just the Internet. Before the Internet came along, X.25 networks were a popular form of packet-based communication (and indeed, X.25 formed the basis for many links on the nascent Internet). From Hacking-Lexicon