Every device on a network has a unique address, like a house in a neighborhood, to ensure data can be delivered successfully. Addresses are used to identify and deliver data throughout the network. A device has two different types of addresses: a physical address, called a MAC (Media Access Control) Address, and a logical address, called an IP (Internet Protocol) Address. Both addresses are needed to successfully navigate a network.
Physical MAC Address
The MAC address bridges the gap between the logical IP address and the physical access of the network interface card (NIC). I know that is a lot of technical jargon, so let me give you this analogy:
If your computer were a building, the MAC address would be the building’s street address; the IP address would be the business name on the building. The building’s address is not going to change, but the business could. In the case of your computer, the MAC address is assigned by the manufacturer and is hardcoded onto the NIC during manufacturing. Each NIC on a network must have a unique MAC address to help identify devices for delivery and troubleshooting.
The MAC address is comprised of six octets, 8 bits, of hexadecimal values. The first three octets, 24bits, are the organizationally unique identifier (OUI), which identifies who manufactured the NIC. Most manufacturers will have at least one OUI assigned to them and some companies, like Microsoft with over 60, have many OUIs to use.
The last three octets, 24bits, is uniquely assigned by the vendor to a specific NIC. With a full MAC address you can know the manufacturer and uniquely identify a device on any given network.

Logical IP Address
Unlike the physical, unchanging MAC address, an IP address is a logical address meaning it can change and is not limited to the physical layout of your network. This means that your computer can “logically” be connected to your work network even if you are physically at home. An IP address is assigned to a NIC, not during manufacturing, but every time it connects to a network. While MAC addresses are just a physical identifier, the IP standard also includes rules and protocols for how data is transmitted from device to device.
An IP address is comprised of 32 bits divided into four octets, 8 bits each. The address is commonly shown in the 192.168.1.100 format; however, it can also be written in binary, shown below. The subnet mask, which is beyond this introduction, dictates which part of the address is used for the network address and the host address. All devices on the same logical IP network have the exact same network address but will have different host addresses.

IPv6
So far, I have been discussing IP version 4 (IPv4), but sadly we are running out of IP addresses for use with IPv4. There have been techniques and solutions for conserving IP addresses, however, here we are with no more addresses. Luckily, we have the new IPv6 with 3.438 addresses available to use.
IPv6 brings updated security and routing improvements to the aging IPv4. Originally introduced in 1995, and finally accepted as an Internet Standard in 2017, IPv6 is already being used across the internet today and private networks. Most devices will use a combination of IPv4 and IPv6 depending on the software and actions involved.
Image from Wikipedia
Why Does This Matter?
The internet is a huge, expansive web of cabling and routers; and yet by some magic, it all connects as one big piece. I hope by seeing the complexity of addressing a network gives you more of an appreciation the next time you connect to the free WiFi at Starbucks.