An electrolyte is a substance that produces an electrically conducting solution when dissolved in a polar solvent, such as water. The dissolved electrolyte separates into cations and anions, which disperse uniformly through the solvent. Electrically, such a solution is neutral. If an electric potential is applied to such a solution, the cations of the solution are drawn to the electrode that has an abundance of electrons, while the anions are drawn to the electrode that has a deficit of electrons. The movement of anions and cations in opposite directions within the solution amounts to a current. This includes most soluble salts, acids, and bases. Some gases, such as hydrogen chloride, under conditions of high temperature or low pressure can also function as electrolytes. Electrolyte solutions can also result from the dissolution of some biological (e.g., DNA, polypeptides) and synthetic polymers (e.g., polystyrene sulfonate), termed "polyelectrolytes", which contain charged functional groups. A substance that dissociates into ions in solution acquires the capacity to conduct electricity. Sodium, potassium, chloride, calcium, magnesium, and phosphate are examples of electrolytes.

Arrhenius's explanation was that in forming a solution, the salt dissociates into charged particles, to which Michael Faraday had given the name "ions" many years earlier. Faraday's belief had been that ions were produced in the process of electrolysis. Arrhenius proposed that, even in the absence of an electric current, solutions of salts contained ions. He thus proposed that chemical reactions in solution were reactions between ions.

An electrolyte in a solution may be described as "concentrated" if it has a high concentration of ions, or "diluted" if it has a low concentration. If a high proportion of the solute dissociates to form free ions, the electrolyte is strong; if most of the solute does not dissociate, the electrolyte is weak. The properties of electrolytes may be exploited using electrolysis to extract constituent elements and compounds contained within the solution.

All known higher lifeforms require a subtle and complex electrolyte balance between the intracellular and extracellular environments. In particular, the maintenance of precise osmotic gradients of electrolytes is important. Such gradients affect and regulate the hydration of the body as well as blood pH, and are critical for nerve and muscle function. Various mechanisms exist in living species that keep the concentrations of different electrolytes under tight control.

Electrolyte balance is maintained by oral, or in emergencies, intravenous (IV) intake of electrolyte-containing substances, and is regulated by hormones, in general with the kidneys flushing out excess levels. In humans, electrolyte homeostasis is regulated by hormones such as antidiuretic hormones, aldosterone and parathyroid hormones. Serious electrolyte disturbances, such as dehydration and overhydration, may lead to cardiac and neurological complications and, unless they are rapidly resolved, will result in a medical emergency.

In oral rehydration therapy, electrolyte drinks containing sodium and potassium salts replenish the body's water and electrolyte concentrations after dehydration caused by exercise, excessive alcohol consumption, diaphoresis (heavy sweating), diarrhea, vomiting, intoxication or starvation. Athletes exercising in extreme conditions (for three or more hours continuously, e.g. a marathon or triathlon) who do not consume electrolytes risk dehydration (or hyponatremia).

When electrodes are placed in an electrolyte and a voltage is applied, the electrolyte will conduct electricity. Lone electrons normally cannot pass through the electrolyte; instead, a chemical reaction occurs at the cathode, providing electrons to the electrolyte. Another reaction occurs at the anode, consuming electrons from the electrolyte. As a result, a negative charge cloud develops in the electrolyte around the cathode, and a positive charge develops around the anode. The ions in the electrolyte neutralize these charges, enabling the electrons to keep flowing and the reactions to continue.