integrated circuit (IC)
An integrated circuit is an entire electronic circuit — thousands to billions of transistors plus all their wiring — built together on a single thumbnail-sized sliver of silicon, the "chip." Before ICs, engineers soldered individual transistors and resistors together by hand, like wiring a city one streetlight at a time. An IC fabricates the whole city in one go, so the parts are born already connected — microscopically small, fast, and cheap.
Chips are made by photolithography: light projects circuit patterns onto a silicon wafer coated in light-sensitive resist, and chemicals etch the exposed pattern, layer by layer — the transistors first, then the metal wires stacked above them. Repeating this builds millions of devices side by side in one run. Modern VLSI (very-large-scale integration) packs billions of transistors with features only a few nanometres wide; the processor in your phone is one such chip, holding more switches than there are stars you can see in the sky.
The IC was invented around 1958 independently by Jack Kilby (a working germanium prototype at Texas Instruments) and Robert Noyce (the planar silicon version at Fairchild that made mass production practical). Mind the layers: a "transistor" is one switch, an "integrated circuit" is many switches and wires on a single die, and the "chip" is that die — usually sealed inside the small black package you actually see soldered to a board.