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.
IPv6
Internet Protocol Version 4 (IPv4) was the first publicly used version of the Internet Protocol. IPv4 was developed as a research project by the Defense Advanced Research Projects Agency (DARPA), a United States Department of Defense agency, before becoming the foundation for the Internet and the World Wide Web. IPv4 includes an addressing system that uses numerical identifiers consisting of 32 bits. These addresses are typically displayed in quad-dotted notation as decimal values of four octets, each in the range 0 to 255, or 8 bits per number. Thus, IPv4 provides an addressing capability of 2 or approximately 4.3 billion addresses. Address exhaustion was not initially a concern in IPv4 as this version was originally presumed to be a test of DARPA's networking concepts. During the first decade of operation of the Internet, it became apparent that methods had to be developed to conserve address space. In the early 1990s, even after the redesign of the addressing system using a classless network model, it became clear that this would not suffice to prevent IPv4 address exhaustion, and that further changes to the Internet infrastructure were needed.