IP addressing uses logical addressing at the network layer and includes both IP version 4 (32-bit) and version 6 (128-bit). MAC addressing uses physical addressing at the data link layer with a 48-bit address. IP addresses are divided into classes (A-E) based on the priority bit in the first octet, with each class designating a range of addresses and dividing the address into a network and host portion using subnet masks. Private IP addresses are reserved ranges that can be used internally without being routed on the public internet.