Hadoop is an Apache open-source framework designed for distributed processing of large datasets across clusters of commodity hardware using simple programming models, primarily through the MapReduce algorithm. It consists of two main layers: the processing layer (MapReduce) and the storage layer (Hadoop Distributed File System or HDFS), which offers features like fault tolerance, data management, and scalability. While Hadoop provides significant advantages such as cost-effectiveness and high throughput, it also faces limitations related to small file handling, processing speed, and lack of real-time data processing.