A shock absorber is basically an oil pump placed between the frame of the car and the wheels. The upper mount of the shock connects to the frame (i.e., the sprung weight), while the lower mount connects to the axle, near the wheel (i.e., the unsprung weight). In a twin-tube design, one of the most common types of shock absorbers, the upper mount is connected to a piston rod, which in turn is connected to a piston, which in turn sits in a tube filled with hydraulic fluid. The inner tube is known as the pressure tube, and the outer tube is known as the reserve tube. The reserve tube stores excess hydraulic fluid.When the car wheel encounters a bump in the road and causes the spring to coil and uncoil, the energy of the spring is transferred to the shock absorber through the upper mount, down through the piston rod and into the piston. Orifices perforate the piston and allow fluid to leak through as the piston moves up and down in the pressure tube. Because the orifices are relatively tiny, only a small amount of fluid, under great pressure, passes through. This slows down the piston, which in turn slows down the spring.
Shock absorbers work in two cycles -- the compression cycle and the extension cycle. The compression cycle occurs as the piston moves downward, compressing the hydraulic fluid in the chamber below the piston. The extension cycle occurs as the piston moves toward the top of the pressure tube, compressing the fluid in the chamber above the piston. A typical car or light truck will have more resistance during its extension cycle than its compression cycle. With that in mind, the compression cycle controls the motion of the vehicle's unsprung weight, while extension controls the heavier, sprung weight.
All modern shock absorbers are velocity-sensitive -- the faster the suspension moves, the more resistance the shock absorber provides. This enables shocks to adjust to road conditions and to control all of the unwanted motions that can occur in a moving vehicle, including bounce, sway, brake dive and acceleration squat.