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BitTorrent is a protocol that underpins the practice of peer-to-peer file sharing and is used for distributing large amounts of data over the Internet. Basically, someone has a file they want to share and you want to download it.

So lets say Mike has a copy of Windows 95. He has turned the CD into an ISO. An ISO is a single file of the CD as an image. So instead of the CD being in a bunch of files, the CD is in just one nice and tidy file. He can use BitTorrent to share this file with anyone who wants it. The file is published on BitTorrent sites, like The Pirates Bay. So now anyone who is searching for Windows 95 will see Mike's file and have the option to download it.

Let's say 20 people download Mike's Windows 95 ISO and they are all sharing it. And let's say you want this file as well. You go to The Pirates Bay, you search for Windows 95 and find Mike's file. You start to download it because you see 21 people sharing this file. As you are downloading it, bits and pieces of Mike's file are grabbed from the 21 people sharing it. When all the pieces have been downloaded, your file is complete and you now have Mike's Windows 95 ISO.

Everyone has their favorite BitTorrent Client. Here is a nice one to get you started.