Snort is an open source network intrusion detection and prevention system that monitors network traffic and compares it against a ruleset to detect anomalous activity. It works on the network, transport, and application layers to analyze packet headers, payloads, and apply detection rules using a string matching algorithm. Snort includes components like a packet decoder, preprocessors, detection engine, and output modules. The detection engine applies rules to packets in priority order to detect known intrusions based on signatures as well as potential new attacks. Improving Snort involves optimizing its rule processing, offloading work to hardware, and developing better detection algorithms.