IP addresses identifies computers per NIC.
Usage
Private
Assigned to computer on local network, fall within certain ranges and only accessible on same LAN. The private address is only necessary with IPv4.
The reserved address space:
10.0.0.0/8172.16.0.0/12192.168.0.0/16
Public
Internet facing, typically a single address for an entire LAN. Networks use Network Address Translation (NAT) to convert private addresses into a single public address for communication between networks.
Protocol Version
Version 4
Version 4 is the most common and written in the format of xxx.xxx.xxx.xxx like 192.168.1.26 made of 4 bytes. The problem with this version is the limited number of available addresses.
The 127.0.0.1 address points to current computer as the localhost.
Version 6
Version 6 is much more complicated than version 4, which is why there is resistance for switching to version 6. These addresses are 16 bytes long, giving or possibilities, which is more than enough for every atom on the surface of the earth.
Without shortening rules an IPv6 address looks like 2001:0db8:0000:0000:0000:ff00:0042:8329 and with shortening rules: 2001:db8::ff00:42:8329
The local host of IPv6 is ::1.
Managing
The Dynamic Host Configuration Protocol (DHCP) manages IP addresses to avoid conflicts and simplify network joining.