The PPU (Picture Processing Unit), more specifically known as Ricoh RP2C02 (NTSC version) / RP2C07 (PAL version), is the microprocessor in the Nintendo Entertainment System responsible for generating video signals from graphic data stored in memory.
The chip is known for its effective use of memory, using very little memory to store graphical data. It was rather advanced for its time when the Famicom (Japanese version of the Nintendo Entertainment System) was released, having full sprite support, movable backgrounds, and many colors on screen at the same time. To compete with other video game systems, like the graphically superior Sega Master System, Nintendo also extended the PPU's technical capabilities through the use of mappers, which were placed on the game cartridge. The mappers added more memory or could bank switch data into the PPU's address space, making it possible to create more advanced graphics, using more colors and bigger tile sets.
The PPU is controlled via eight registers visible in the CPU's address space in the addresses $2000 through $2007. All data and information is passed to the PPU through these, except the raw tile data (there are exceptions, as some games had RAM instead of ROM to store the tile data, and the tiles had to be written each time), which is hardwired to the PPU's address space. The PPU uses the tile graphics data together with information stored by the program in the PPU's RAM, such as color and position, to render the final graphical output to the screen.
The lowest graphical components the PPU operates with are tiles, which are blocks of 8×8 or 8×16 pixels. The tiles are stored in a ROM chip on the game cartridge. They are the basic building blocks, used to create larger moving objects, or large static backgrounds.