A modem is a device that modulates an analog carrier signal to encode digital information, and also demodulates such a carrier signal to decode the transmitted information. The goal is to produce a signal that can be transmitted easily and decoded to reproduce the original digital data. Modems can be used over any means of transmitting analog signals, from driven diodes to radio. Experiments have even been performed in the use of modems over the medium of two cans connected by a string.

The most familiar example of a modem turns the digital '1s and 0s' of a personal computer into sounds that can be transmitted over the telephone lines of Plain Old Telephone Systems (POTS), and once received on the other side, converts those sounds back into 1s and 0s. Modems are generally classified by the amount of data they can send in a given time, normally measured in bits per second, or "bps".

Far more exotic modems are used by Internet users every day, notably cable modems and ADSL modems. In telecommunications, "radio modems" transmit repeating frames of data at very high data rates over microwave radio links. Some microwave modems transmit more than a hundred million bits per second. Optical modems transmit data over optic fibers. Most intercontinental data links now use optic modems transmitting over undersea optical fibers. Optical modems routinely have data rates in excess of a billion (1x109) bits per second.