The 8086 microprocessor was introduced in 1978 as the first 16-bit microprocessor. It operated at speeds between 5-10 MHz and contained 29,000 transistors. The 8086 included a Bus Interface Unit to fetch instructions and data from memory as well as an Execution Unit to decode and execute instructions. It had general purpose registers like AX, BX, CX, and DX that could be used individually as 8-bit registers or in pairs as 16-bit registers. The 8086 also included segment registers, flag registers, and supported features like an instruction queue and conditional/control flags.