TCP/IP model

The TCP/IP Model separates networking functions into discrete layers. Each layer performs a specific function and is transparent to the layer above it and the layer below it.The TCP/IP model is one of the two most common network models, the other being the OSI Model.
The TCP/IP network model breaks down into four (4) layers:

• Application Layer
• Transport Layer
• Internet Layer
• Network Access Layer

TCP/IP Model Layers

Application Layer

The Application Layer provides the user with the interface to communication. This could be your web browser, e-mail client (Outlook, Eudora or Thunderbird), or a file transfer client.
The Application Layer is where your web browser, a telnet, ftp, e-mail or other client application runs. Basically, any application that rides on top of TCP and/or UDP that uses a pair of virtual network sockets and a pair of IP addresses.
The Application Layer sends to, and receives data from, the Transport Layer.

Transport Layer

The Transport Layer provides the means for the transport of data segments across the Internet Layer. The Transport Layer is concerned with end-to-end (host-to-host) communication.
Transmission Control Protocol provides reliable, connection-oriented transport of data between two endpoints (sockets) on two computers that use Internet Protocol to communicate.
User Datagram Protocol provides unreliable, connectionless transport of data between two endpoints (sockets) on two computers that use Internet Protocol to communicate.
The Transport Layer sends data to the Internet layer when transmitting and sends data to the Application Layer when receiving.

Internet Layer

The Internet Layer provides connectionless communication across one or more networks, a global logical addressing scheme and packetization of data. The Internet Layer is concerned with network to network communication.
The Internet Layer is responsible for packetization, addressing and routing of data on the network. Internet Protocol provides the packetization, logical addressing and routing functions that forward packets from one computer to another.
The Internet Layer communicates with the Transport Layer when receiving and sends data to the Network Access Layer when transmitting.

Network Access Layer

The Network Access Layer provides access to the physical network.
This is your network interface card. Ethernet, FDDI, Token Ring, ATM, OC, HSSI, or even Wi-Fi are all examples of network interfaces. The purpose of a network interface is to allow your computer to access the wire, wireless or fiber optic network infrastructure and send data to other computers.
The Network Access Layer transmits data on the physical network when sending and transmits data to the Internet Layer when receiving.
 
All Internet-based applications and their data, whether it is a web browser downloading a web page, Microsoft Outlook sending an e-mail, a file, an instant message, a Skype video or voice call; the data is chopped into data segments and encapsulated in Transport Layer Protocol Data Units or PDU's (TCP or UDP segments). The Transport Layer PDU's are then encapsulated in Internet Layer's Internet Protocol packets. The Internet Protocol packets are then chopped into frames at the Network Access layer and transmitted across the physial media (copper wires, fiber optic cables or the air) to the next station in the network.
The OSI Model uses seven layers, and differs quite a bit from the TCP/IP model. The TCP/IP model does a better job of representing how TCP/IP works in a network, but the OSI Model is still the networking model most technical people refer to during troubleshooting or network architecture discussions.