L2 cache

Its a small amout of memory on the CPU that hold data that you use over and over so it can access it faster instead of going through the harddrive and system ram!!
 
no, it doesnt hold the memory over and over... it "remembers" what its done and locations in the memory. generally it helps slightly with memory bandwidth and if you're doing a continuous process, like hardcore gaming or really any prolonged cpu intensive process.

L1 cache holds instruction sets, like sse3 and the like. if im not mistaken, that is.
http://en.wikipedia.org/wiki/CPU_cache
the difference between 128kb and 1mb of L2 cache is large, whereas the difference between 1mb and 4mb is quite small... as of right now though, im sure cpu's will require a much larger cache as we start using more and more memory intensive applications like Quake 4 for instance uses between 1.2 and 1.8gb of system memory when configured on ultra settings...
 
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When the processor wishes to read or write a location in main memory, it first checks whether that memory location is in the cache. This is accomplished by comparing the address of the memory location to all tags in the cache that might contain that address. If the processor finds that the memory location is in the cache, we say that a cache hit has occurred, otherwise we speak of a cache miss. In the case of a cache hit, the processor immediately reads or writes the data in the cache line. The proportion of accesses that result in a cache hit is known as the hit rate, and is a measure of the effectiveness of the cache

Said easier
The L1 cache is like the desk. Data here is very close at hand and well organized so that it’s quickly located. The larger the desk (L1 cache), the greater the chance that the information you need is available for fast retrieval. L2 cache is similar to the shelves behind the desk. It's closer than the main memory (file cabinets across the room), but getting information from the L2 cache still takes longer than from the L1 cache. You have quick access, but there is a slight delay when retrieving the information.
 
it only holds for a few seconds.
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It holds it until it needs that space for something else.
The L1 cache is like the desk. Data here is very close at hand and well organized so that it’s quickly located. The larger the desk (L1 cache), the greater the chance that the information you need is available for fast retrieval. L2 cache is similar to the shelves behind the desk. It's closer than the main memory (file cabinets across the room), but getting information from the L2 cache still takes longer than from the L1 cache. You have quick access, but there is a slight delay when retrieving the information.
Click to expand...
Nice analogy. There's more to understanding how it works than that but it's a good overview.
 
In a even more simple explanation, its a cheap way to make your CPU-Harddrive and Ram seem faster than they really are;)
 
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