Memory storage

Computer data storage, often called storage or memory, refers to computer components and recording media that retain digital data. Data storage is one of the core functions and fundamental components of computers.
In contemporary usage, memory usually refers to semiconductor storage random-access memory, typically DRAM (Dynamic-RAM). Memory can refer to other forms of fast but temporary storage. Storage refers to storage devices and their media not directly accessible by the CPU, (secondary or tertiary storage) — typically hard disk drives, optical disc drives, and other devices slower than RAM but more permanent.[1] Historically, memory has been called main memory, real storage or internal memory while storage devices have been referred to as secondary storage, external memory or auxiliary/peripheral storage.
Many different forms of storage, based on various natural phenomena, have been invented. So far, no practical universal storage medium exists, and all forms of storage have some drawbacks. Therefore a computer system usually contains several kinds of storage, each with an individual purpose.
A digital computer represents data using the binary numeral system. Text, numbers, pictures, audio, and nearly any other form of information can be converted into a string of bits, or binary digits, each of which has a value of 1 or 0. The most common unit of storage is the byte, equal to 8 bits. A piece of information can be handled by any computer whose storage space is large enough to accommodate the binary representation of the piece of information, or simply data. For example, using eight million bits, or about one megabyte, a typical computer could store a short novel.
Traditionally the most important part of every computer is the central processing unit (CPU, or simply a processor), because it actually operates on data, performs any calculations, and controls all the other components. The CPU consists of two (2) main parts: Control Unit and Arithmetic Logic Unit (ALU). The former controls the flow of data between the CPU and memory whilst the latter is used for performing arithmetic and logical operations on data.

References:

Wikipedia
Microsoft Help