IPsec is a standardized framework that provides security (encryption, authentication, integrity) for IP communications. It has two modes - Transport mode which encrypts only the payload, and Tunnel mode which encrypts both the header and payload. IPsec uses protocols like AH (Authentication Header) which provides authentication and integrity, and ESP (Encapsulating Security Payload) which provides confidentiality, authentication, and integrity. IPsec implementations can be in end hosts or routers depending on network requirements.