The Open Systems Interconnection Basic Reference Model (OSI Reference Model or OSI Model for short) is a layered, abstract description for communications and computer network protocol design, developed as part of the Open Systems Interconnection initiative. It is also called the OSI seven layer model.

The seven layers are:

7) Application : Provides different services to the applications

6) Presentation : Converts the information

5) Session : Handles problems which are not communication issues

4) Transport : Provides end to end communication control

3) Network : Routes the information in the network

2) Data Link : Provides error control between adjacent nodes

1) Physical : Connects the entity to the transmission media

More information you can find here: http://en.wikipedia.org/wiki/OSI_model
You can read how OSI layers work here: http://computer.howstuffworks.com/osi1.htm