Generally, there are 2 main types of data used within a Geographical Information System(GIS), those being vector data and raster data. Both models have a series of advantages and diadvantages when it comes to the storing of geographic information, and a fully functional GIS will handle both of them.
Vecter data is recorded as a series of distinct points, lines or polygons(areas). In the vector model information about points, lines and polygons is encoded and stored as a collection of x-y corinates, for instance a location of a manhole is described by a single of X-Y coordinates, Roads by a series of X-Y points and a area such as a county or lake etc by a joining line.
The vector format is better at storing a accurate record of the location of features than Raster Data.