The connection can be made to a database hosted on the same machine or remotely on another server.

When you query data on a different database, you are essentially using a distributed query.
It is also possible to execute distributed transactions through database links like insert, update and delete.

The authentication used in a database link is either the link’s owner or a hard-coded username and password, depending on the way the link was created.

A database link in oracle can be either private (for use only by the link’s owner) or public (accessible to any user with the correct privileges).

Connectivity is established via Sql*Net, using an alias defined in the local database server’s tnsnames.ora

Have a look at the tutorials on this site  to find out more about oracle database links :

Dblinks category