How do domain names work?
A domain name is very similar to an address forwarding service. The domain name is the address people type in their web browser to get to your web site. The domain name then points to the “real” address that contains your web site. The “real” address is called the IP address and is a series of numbers, such as 123.23.234.45. This IP address then points to the location on the server that contains your web site files. The reason we use domain names instead of IP addresses is because for most people a name, rather than a series of numbers, is much easier to remember. So, your domain name points to your IP address, which in turn points to your web site which allows users all across the Internet to view your web pages.
The internet permits computers to communicate based on knowing a numeric address for another computer. At its simplest, domain names are human friendly aliases for these numbers. Software called a Domain Name Service (DNS) translates the names into numbers. More information on the methods used can be obtained here.