Unlike TCP, the User Datagram Protocol (UDP) does not present data as a stream of bytes, nor does it require that you establish a connection with another program in order to exchange information. Data is exchanged in discrete units called datagrams, which are similar to IP datagrams. In fact, the only features that UDP offers over raw IP datagrams are port numbers and an optional checksum.
UDP is sometimes referred to as an unreliable protocol because when a program sends a UDP datagram over the network, there is no way for it to know that it actually arrived at it's destination. This means that the sender and receiver must typically implement their own application protocol on top of UDP. Much of the work that TCP does transparently (such as generating checksums, acknowledging the receipt of packets, retransmitting lost packets and so on) must be performed by the application itself.
With the limitations of UDP, you might wonder why it's used at all. UDP has the advantage over TCP in two critical areas: speed and packet overhead. Because TCP is a reliable protocol, it goes through great lengths to insure that data arrives at it's destination intact, and as a result it exchanges a fairly high number of packets over the network. UDP doesn't have this overhead, and is considerably faster than TCP. In those situations where speed is paramount, or the number of packets sent over the network must be kept to a minimum, UDP is the solution.
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