What is the difference between hostname and IP address?

A host name is a combination of the name of your machine and a domain name (e.g. machinename.domain.com). The purpose of a host name is readability - it's much easier to remember than an IP address. All hostnames resolve to IP addresses, so in many instances they are talked about like they are interchangeable

A name is a label that is used to distinguish one thing from another. A person's name, for instance, comprises a set of alphabetic characters that allows a person to be individually addressed. Computers are also named to differentiate one machine from another and to allow for such activities as network communication.

Computers have always needed unique addresses to talk to each other. With the advent of the Internet, the requirements for enabling computers to communicate with each other on a network included the concept of the hostname. The hostname began as a simple string of alphanumeric characters (and possibly a hyphen) and has evolved to its current definition, where hostname means a Fully Qualified Domain Name (FQDN) that absolutely and uniquely identifies every computer hooked up to the Internet via the Domain Name Service (DNS) naming hierarchy.

The true "name" a computer needs in order to communicate on a network is actually a set of numbers. The original computers connected as the Internet used small integers as the host number. For TCP/IP, the main protocol used by the Internet, each computer has a network IP address that follows a specific set of rules to assure its uniqueness and validity. (Additionally, port numbers further specify the access points for particular services on a computer).

It has always been user friendly to associate a host name with a computer (while the computer maintained its internal numerical host number or network address). One of the initial Internet RFCs, "Standardization of Host Mnemonics" lists the table that associated host numbers with their corresponding host names for the first Internet computers. This table was kept in a file called HOST.TXT that was stored on every computer that wished to communicate.

While the original file was not so daunting at 20 entries, it became quickly apparent that this solution was not scalable or flexible enough as the number of host computers connected to the Internet exploded. In order to accommodate the problem of connecting all of the new computers being added to the Internet, a hierarchical database of host names was created called DNS. DNS associates host names with their IP addresses. A complete domain name (that is, an FQDN) includes the name of the host concatenated with its domain name. This naming convention allows for a hierarchy of domain names with the host name being the most specific (and "left-most") part.