Internet of Things, aka. IoT is a network of connected computers as well as other mechanical and digital devices that can collect and exchange data using embedded sensors.
 

In other words, IoT is a system of physical devices that can be accessed and controlled via the internet without requiring human-to-human or human-to-computer interaction. The internet is generally accessed via computers and other smart devices such as laptops, tablets, smartphones, etc. these devices can be connected to one network and can collect and exchange data using embedded sensors.

IoT technology integrates four distinct components: sensors or devices, connectivity, data processing, and a user interface. 

• The sensors or devices are connected to the cloud. 
• All the data collected by the sensors or devices get stored on the cloud. 
• Once the data gets to the cloud, software processes it and then might decide whether to perform an action or not, and if yes then which.