The document discusses the role and functions of the Network layer (OSI Layer 3) in data networks. It examines the Internet Protocol (IP) as the most widely used Network layer protocol. IP provides connectionless and best-effort delivery of data packets across networks. The document also discusses how networks are logically grouped and addressed in a hierarchical manner to allow communication between large numbers of devices across interconnected networks. Key concepts covered include addressing, routing, encapsulation, next hop forwarding, and the use of static and dynamic routing to build routing tables.