Since many users are familiar with IBM PCs and Macintoshes, which have similar ways of clustering files, we shall spend less time explaining the directory concept than describing what commands UNIX allows us to do.
Files are storage entities which contain data.
Files with related purposes are clustered together and stored in directories. In reality, a UNIX directory is itself a file. It contains a list of names of other files and directories and pointers to the actual files' location on disk. UNIX manages all the disk space for you, and it stores all files on disk in ways that you needn't even think about. These pointers are actually addresses of places on the disk where the data is stored.