Generations of computers have been divided into five generations based on the underlying technologies used. The first generation used vacuum tubes, were enormous in size, and had low processing speeds. The second generation used transistors, were smaller in size, and had faster processing speeds. The third generation used integrated circuits, which made computers more reliable and affordable. The fourth generation used microprocessors, which placed all computer components on a single chip and led to the development of personal computers. Current computers are considered fifth generation and utilize technologies like artificial intelligence and parallel processing.