The smallest unit of information, a computer can understand and process is known as:

A bit, holding a single 0 or 1, is the smallest unit of information a computer can understand and process.

Everything a computer stores or processes is ultimately built from these binary bits.

A digit is a general numeric symbol and is not the fundamental unit of computer information.

A byte is a group of eight bits, so it is larger than the smallest unit.

A nibble is a group of four bits, so it too is larger than a single bit.

Eight bits make one byte, which typically represents a single character.