Internationalized Domain Names for Applications (IDNA)
IDNA is a IETF technical standard developed to enable the use of domain names in scripts other ASCII. Work on a revision of the IDNA standard is currently in progress (IDNAbis).
The word "IDN" stands for "internationalized domain name". The word "international" refers to the fact that users from all nations should be able to use domains in their own script. It does not mean an IDN would be usable by anyone as usage will naturally be limited to those knowing the scripts and having access to the required fonts and input methods. From the perspective of the user of an IDN domain name, one might see IDNs as "localized" domains.
The use of IDNA is limited to the domain name itself. This means that any expression used before the domain name (such as the user name in an email address before the "@" sign) or the after the domain name (such as the URI path following the first "/" sign) are based on other standards than IDNA.
IDN for second-level and lower-level domains
Since 2000 - even before the finalization of the first IDNA protocol - a number of TLD registries started offering IDN registrations on the second level. This is an effective solution for "decorated" Latin letters (such as German Umlauts or accents in French or other diacritical marks). It not usually a comfortable solution, however, for non-Latin scripts as users have to switch between two inputs methods as they type a single domain.
IDN on TLD Level (IDN.IDN)
The introduction of IDN domains on the top level is a key objective both for the technical development of the domain name system and for Internet governance at large. The objective is to enable users to write the entire domain in their own script. To avoid forcing users to change input methods in the middle of the domain name, the TLD itself must also be an IDN string.