Most people refer to the stock market in a generic way. In truth there are actually dozens of different stock exchanges. One of the largest and best known of these is the NASDAQ. The NASDAQ got its start as an electronic trading bulletin board in the seventies but since then it has grown to become one of the largest stock exchanges in the world.
The NASDAQ is the world's second largest stock exchange and it is one of the fastest growing. It is well known for listing the stocks of technology companies although these days they list companies from pretty much all industries. The real claim to fame of the NASDAQ is that it was the world's first electronic stock exchange. To this day it remains the world's largest. There is no trading floor like there is for other stock exchanges all of the trades are done electronically. This offers the advantage of lower transaction costs than on the stock exchanges that rely on floor traders.
The NASDAQ was founded in the early seventies by the National Association of Securities Dealers. The main purpose in the early days was to simplify the process of over the counter transactions. Over the counter stock trades are ones that are made between two parties on publicly traded companies that aren't listed on a stock exchange. Normally they aren't listed because they are too small. In order to make an over the counter trade the buyer and the seller have to find each other and agree on the price. This is different than on a stock exchange where the brokers will handle that. The NASDAQ started simply as an electronic bulletin board that allowed buyers and sellers of over the counter stocks to find each other.
One of the reasons that the NASDAQ quickly became so popular is that it lowered the spread price. Prior to this if you wanted to make an over the counter trade the only practical way to do it was to find a broker who specialized in the field. If you wanted to buy he would go out and find a seller. However the price that he charged the buyer would be more than the price the seller received, this is called the spread it is how brokers make most of their money. By putting all of the trades on a bulletin board the spreads came down as everybody could see what the bid and ask prices were. This was good for the investor but not for the broker.
Over the years the NASDAQ started to operate more and more like the stock exchange. Nowadays they no longer trade over the counter stocks, they only trade stocks that are listed on their exchange. They now operate in pretty much the same way as all of the other stock exchanges. Despite the different way that they got their start the NASDAQ has grown into a large and well respected stock exchange.