A byte consists of eight binary digits. A string of eight of these digits forms a byte that can represent as many as 256 different values.
A binary digit, or a bit, is a variable that can represent two states: on or off or 0 and 1. It is the absolute smallest value that a modern computer can represent. Bits are most commonly referenced in the sense of processor architectures, such as a 64-bit processor being able to reference 64 bits at a time in its datapath. They also are the fundamental building blocks of larger data structures; for example, a kilobyte of hard drive space is comprised of 1,024 bytes, or 8,192 bits.