What are transactions in databases? What is the meaning and main difference of transaction isolation levels?

A database transaction is a logically connected sequence of operations that is executed as a single unit. The main properties of transactions are described by the acronym ACID:

• Atomicity — all operations of the transaction are completed fully or not at all.
• Consistency — the transaction transitions the database from one correct state to another.
• Isolation — concurrent transactions do not affect each other.
• Durability — after commit, changes are saved even in case of failures.

Transaction isolation levels determine the degree to which the changes made by one transaction are visible to others and influence possible anomalies:

1. Read Uncommitted — a transaction can see uncommitted changes of others (dirty read).
2. Read Committed — only committed changes are visible, but non-repeatable reads are possible.
3. Repeatable Read — guarantees that repeated reads of the same data within a transaction will yield the same result, but phantom reads (new rows) are possible.
4. Serializable — the strictest level, transactions are executed as if sequentially, eliminating all anomalies.

The main difference is the balance between performance and strict isolation. The higher the level, the less concurrency, but the higher data integrity.