CPU caches bridge the speed gap between fast processors and slower RAM. Without them, your CPU would constantly wait for data, creating a performance bottleneck.

The cache hierarchy works on a simple principle: keep the most frequently accessed data in the fastest storage. When the CPU needs data, it checks these caches in order before going to RAM.

L1 Cache: The smallest but fastest cache (64-256KB per core), directly integrated into each CPU core. It's typically split between instructions (L1i) and data (L1d). Access takes just 2-4 CPU cycles - practically instantaneous. L1 cache operates at essentially the same speed as the processor core itself.

L2 Cache: Larger but slightly slower (256KB-1MB per core), with access taking 10-12 cycles. Still located on the CPU die but not integrated directly into the core. L2 captures data that doesn't fit in L1 but might be needed soon.

L3 Cache: Significantly larger (4-64MB) but slower (30-70 cycles), shared among all cores. While slower than L1/L2, it's still much faster than accessing RAM (200-300 cycles). L3 serves as the last defense before the CPU must reach out to RAM.

Why not just make one big fast cache? Physics and economics. Larger caches inherently have longer access times due to physical distances, and faster cache requires more transistors per bit, making it expensive in chip area.

This tiered approach provides an excellent compromise - the most frequently accessed data gets the fastest response, while still maintaining a large total cache capacity.