By Cleve Moler, MathWorks
Computation with real numbers is not very practical because it involves limits and infinities. Instead, MATLAB® and most other technical computing environments use floating-point arithmetic, which involves a finite set of numbers with finite precision. This leads to phenomena like roundoff error, underflow, and overflow. Most of the time, MATLAB can be effectively used without worrying about these details, but every once in a while, it pays to know something about the properties and limitations of floating-point numbers.
In this article, originally published in 1996, Cleve Moler explains the benefits and drawbacks of using floating-point numbers.