IP address
An IP address serves two principal functions. It identifies the host, or more specifically its network interface, and it provides the location of the host in the network, and thus the capability of establishing a path to that host. Its role has been characterized as follows: "A name indicates what we seek. An address indicates where it is. A route indicates how to get there."
The header of each IP packet contains the IP address of the sending host, and that of the destination host.
IP address
An IPv4 address has a size of 32 bits, which limits the address space to (2) addresses. Of this number, some addresses are reserved for special purposes such as private networks (~18 million addresses) and multicast addressing (~270 million addresses).