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UNIX is an operating system. The job of an operating system is to orchestrate the various parts of the computer -- the processor, the on-board memory, the disk drives, keyboards, video monitors, etc. -- to perform useful tasks. The operating system is the master controller of the computer, the glue that holds together all the components of the system, including the administrators, programmers, and users. When you want the computer to do something for you, like start a program, copy a file, or display the contents of a directory, it is the operating system that must perform those tasks for you.
More than anything else, the operating system gives the computer its recognizable characteristics. It would be difficult to distinguish between two completely different computers, if they were running the same operating system. Conversely, two identical computers, running different operating systems, would appear completely different to the user.
UNIX was created in the late 1960s, in an effort to provide a multiuser, multitasking system for use by programmers. The philosophy behind the design of UNIX was to provide simple, yet powerful utilities that could be pieced together in a flexible manner to perform a wide variety of tasks.
The UNIX operating system comprises three parts: The kernel, the standard utility programs, and the system configuration files.

The kernel

The kernel is the core of the UNIX operating system. Basically, the kernel is a large program that is loaded into memory when the machine is turned on, and it controls the allocation of hardware resources from that point forward. The kernel knows what hardware resources are available (like the processor(s), the on-board memory, the disk drives, network interfaces, etc.), and it has the necessary programs to talk to all the devices connected to it.
 A/C to  Red hat....

What is Linux?

Linux is an operating system that can be downloaded free and "belongs" to an entire community of developers, not one corporate entity. In other words, anyone from professional software developers to hobbyist computer hackers can access and make changes to the Linux kernel—all the information about Linux is open and available to everyone. That's why Linux is known as "open source" or "free software," because there is nothing secret about this system. This freedom also allows companies to sell and distribute Linux on CD-ROM or by other means, although those companies must keep their code open to the public.
With more and more people looking for an alternative to Windows, Linux has recently grown in popularity and is quickly becoming a favorite among major corporations and curious desktop users. Not only does it give users a choice of operating systems, it also proves itself valuable with its power, flexibility, and reliability.

How did Linux get started?

The concept of open source programming has been around for many years—its roots stem from universities that needed to be able to share information as well as allow students and developers to adapt programs to meet their needs. In 1984, Richard Stallman, a researcher at the MIT AI Lab, started a project he called GNU to counter the fast-moving trend toward proprietary, fee-based software. Stallman, who remains an open advocate of open source, believes that making source code available to anyone who wants it is integral to furthering computer science and innovation.
This concept served as the basis of Linux development, the brainchild of Linus Torvalds. When Torvalds began developing Linux in 1991, he was a student at the University of Helsinki and originally targeted Linux at the Intel 386 (although it is now one of the most widely ported operating systems available for PCs). Torvalds wanted to write a new version of UNIX, so he and a group of programmers combined talents and created a core operating system called Linux.

Linux in Business

Why does Linux make a good operating system for a business?

Linux is the fastest-growing server-side operating system today, and it's making inroads on the desktop. Unlike proprietary operating systems, Linux can be installed and upgraded for free. This makes it extremely attractive to those businesses that don't have a high budget but still want an excellent operating system. But cost is not the main factor. Many companies, large and small, prefer Linux simply because of its reliability: Linux can run for months, even years, without having to be rebooted. And because the source code is open, bugs can be fixed quickly and easily without having to wait for proprietary vendors to issue fixes on a schedule that suits them more than their customers. Businesses also value open source software because it allows groups of companies to collaborate on software problems and issues without being concerned about an anti-trust lawsuit. Linux programs can be installed on practically any machine—including older, outdated computers—and offer business owners a degree of flexibility they wouldn't find with other operating systems.