Ethernet uses star topology for the physical wiring layout. A diagram of a typical Ethernet network layout is shown below
On a network, a hub is basically a repeater which is used to re-time and amplify the network signals. In this diagram, please examine the hubs closely. On the left are 4 ports close to each other with an x above or below them. This means that these ports are crossover ports. This crossover is similar to the arrangement that was used for serial cables between two computers. Each serial port has a transmitter and receiver. Unless there was a null modem connection between two serial ports, or the cable was wired to cross transmit to receive and vice versa, the connection would not work. This is because the transmit port would be sending to the transmit port on the other side.
Therefore note that you cannot connect two computers together with a straight network jumper cable between their network cards. You must use a special crossover cable that you can buy at most computer stores and some office supply stores for around 10 dollars. Otherwise, you must use a hub as shown here.
The hub on the upper left is full, but it has an uplink port on the right which lets it connect to another hub. The uplink does not have a crossover connection and is designed to fit into a crossover connection on the next hub. This way you can keep linking hubs to put computers on a network. Because each hub introduces some delay onto the network signals, there is a limit to the number of hubs you can sequentially link. Also the computers that are connected to the two hubs are on the same network and can talk to each other. All network traffic including all broadcasts is passed through the hubs.
In the diagram, machine G has two network cards, eth0 and eth1. The cards eth1 and eth0 are on two different networks or subnetworks. Unless machine G is programmed as a router or bridge, traffic will not pass between the two networks. This means that machines X and Z cannot talk to machines A through F and vice versa. Machine X can talk to Z and G, and machines A though F can talk to each other and they can talk to machine G. All machines can talk to machine G. Therefore the machines are dependent on machine G to talk between the two networks or subnets.
Each network card, called a network interface card (NIC) has a built in hardware address programmed by its manufacturer. This is a 48 bit address and should be unique for each card. This address is called a media access control (MAC) address. The media, in our specific case will be the ethernet. Therefore when you refer to ethernet, you are referring to the type of network card, the cabling, the hubs, and the data packets being sent. You are talking about the hardware that makes it work, along with the data that is physically sent on the wires.
There are three types of networks that are commonly heard about. They are ethernet, token-ring, and ARCnet. Each one is described briefly here, although this document is mainly about ethernet.
The network interface cards share a common cable. This cable structure does not need to form a structure, but must be essentially common to all cards on the network. Before a card transmits, it listens for a break in traffic. The cards have collision detection, and if the card detects a collision while trying to transmit, it will retry after some random time interval.
Token ring networks form a complete electrical loop, or ring. Around the ring are computers, called stations. The cards, using their built in serial numbers, negotiate to determine what card will be the master interface card. This card will create what is called a token, that will allow other cards to send data. Essentially, when a card with data to send, receives a token, it sends its data to the next station up the ring to be relayed. The master interface will then create a new token and the process begins again.
ARCnet networks designate a master card. The master card keeps a table of active cards, polling each one sequentially with transmit permission.
TCP/IP Illustrated, Volume1, The Protocols
Author:W. Richard Stevens, Publisher: Addison Wesley. ISBN 0201633469