TOR network provides the user with the advantage of privacy and security. The goal of Onion Routing (OR) is to protect the privacy of the sender and recipient of a message, while also providing protection for message content as it traverses a network of Onion Routers. The advantage of Onion Routing is that it is not necessary to trust each cooperating Router; if one or more router is compromised, anonymous communication can still be achieved. This is due to the fact that each Router in an OR network accepts messages, re-encrypts them, and transmits to another Onion Router. An attacker with the ability to monitor every Onion Router in a network might be able to trace the path of a message through the network, but an attacker with more limited capabilities will have difficulty even if he or she controls one or more Onion Routers on the message’s path.
Onion routing is a technique for anonymous communication over a computer network. Messages are repeatedly encrypted and then sent through several network nodes called onion routers. Each onion router removes a layer of encryption to uncover routing instructions, and sends the message to the next router where this is repeated. This prevents these intermediary nodes from knowing the origin, destination, and contents of the message. The Tor Network is a low-latency anonymity, privacy, and censorship resistance network whose servers are run by volunteers around the Internet. This distribution of trust creates resilience in the face of compromise and censorship; but it also creates performance, security, and usability issues. The Tor Flow suite attempts to address this by providing a library and associated tools for measuring Tor nodes for reliability, capacity and integrity, with the ultimate goal of feeding these measurements back into the Tor directory authorities.
Here is the pictorial illustration of working of Onion Router :
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