TOR

Tor (short for The onion router) is a system intended to enable online anonymity. Tor client software routes Internet traffic through a worldwide volunteer network of servers in order to conceal a user's location or usage from anyone conducting network surveillance or traffic analysis. Using Tor makes it more difficult to trace Internet activity, including "visits to Web sites, online posts, instant messages and other communication forms", back to the user and is intended to protect users' personal freedom, privacy, and ability to conduct confidential business by keeping their internet activities from being monitored.
"Onion routing" refers to the layered nature of the encryption service: The original data are encrypted and re-encrypted multiple times, then sent through successive Tor relays, each one of which decrypts a "layer" of encryption before passing the data on to the next relay and, ultimately, its destination. This reduces the possibility of the original data being unscrambled or understood in transit.^[6]
The Tor client is free software and usage of the Tor network is free of charge.


Operation


Tor aims to conceal its users' identities and their network activity from surveillance and traffic analysis by separating identification and routing. It is an implementation of onion routing, which encrypts and then randomly bounces communications through a network of relays run by volunteers throughout the globe. These onion routers employ encryption in a multi-layered manner (hence the onion metaphor) to ensure perfect forward secrecy between relays, thereby providing users with anonymity in network location. That anonymity extends to the hosting of censorship-resistant content via Tor's anonymous hidden service feature. Furthermore, by keeping some of the entry relays (bridge relays) secret, users can evade Internet censorship which relies upon blocking public Tor relays.
Because the internet address of the sender and the recipient are not both in cleartext at any hop along the way at non-exit (or "middle") relays neither piece of information is in cleartext, such that anyone eavesdropping at any point along the communication channel cannot directly identify both ends. Furthermore, to the recipient it appears that the last Tor node (the exit node) is the originator of the communication rather than the sender.

(from wikipedia.org)