Binary numbers can be represented using only two digits, 0 and 1. The binary system counts in powers of two, with the value of each digit place increasing by a factor of two from right to left. Binary numbers can be converted to other bases like octal and hexadecimal for convenience. Octal uses digits 0-7, grouping binary digits into sets of three. Hexadecimal uses digits 0-9 and letters A-F, grouping binary into sets of four. Converting between number bases involves rewriting the binary number into the appropriate groupings and finding the decimal equivalent of each group.