Step into your way back machine and go back to the late '70s. The popular systems at that time were based on 8-bit processors with no more than 64 kilobytes (64 KiB) of memory:
With that nostalgia as context, step back to today. Companies like Microchip and Atmel now make single chip devices that run up to 20Mhz, have from 256 to 8K bytes of RAM, 1Kb to 256Kb of Flash memory and cost less than $10. Atmel's AVR and Microchip's PIC processors are modified Harvard architecture 8-bit RISC single chip microcontrollers that include impressive I/O capabilities - almost every pin in these devices can be programmed to be an input or an output, and some can additionally be used as analog to digital or digital to analog devices. Embedded processors are finding use in many diverse areas, with billions of devices in use around the world.
One of those uses is in a development board called Arduino.
Arduino is an open-source electronics prototyping platform based on flexible, easy-to-use hardware and software. It's intended for artists, designers, hobbyists, and anyone interested in creating interactive objects or environments.
Arduino can sense the environment by receiving input from a variety of sensors and can affect its surroundings by controlling lights, motors, and other actuators. The microcontroller on the board is programmed using the Arduino programming language (based on C++ and Wiring) and the Arduino development environment (based on Processing). Arduino projects can be stand-alone or they can communicate with software on running on a computer.
The Arduino board exposes most of the microcontroller's I/O pins for use by other circuits: 14 digital I/O pins, 6 of which can produce PWM (pulse width modulated) signals, and 6 analog inputs.
 Project Overview
I've been having fun building stuff with the Arduino development environment. Some projects have been simple blinking lights (DangerShield), others have been more complicated (ServoBells and XyloTiger).
I've also ported Alex Shephard's Arduino_Loconet embedded loconet code with breadboarded loconet interface hardware.
See the Category:Electronics Overview page for more information.