The 555 timer is a versatile integrated circuit that can be used to generate accurate timing signals. It works by using internal comparators and a flip-flop to accurately time an external resistor-capacitor circuit. The 555 timer can be used in various configurations (monostable, bistable, astable) to generate pulses or oscillations for applications like timers, flashing lights, and tone generation. It is an inexpensive and robust chip contained in an 8-pin package that can drive loads directly from its output.