The OSI reference model defines a standardized framework for network communication consisting of 7 layers: (1) Physical, (2) Data Link, (3) Network, (4) Transport, (5) Session, (6) Presentation, and (7) Application. Each layer defines a part of the process of moving information across a network, with layers interacting vertically with adjacent layers and horizontally with corresponding layers on other devices. The model provides a basis for understanding how data is encapsulated and communicated between all types of computer systems.