Over the past decade data communications has been revolutionized by a radically new technology called packet switching. In 1968 virtually all interactive data communication networks were circuit switched, the same as the telephone network. Circuit switching networks preallocate transmission bandwidth for an entire call or session. However, since interactive data traffic occurs in short bursts 90 percent or more of this bandwidth is wasted. Thus, as digital electronics became inexpensive enough, it became dramatically more cost-effective to completely redesign communications networks, introducing the concept of packet switching where the transmission bandwidth is dynamically allocated, permitting many users to share the same transmission line previously required for one user. Packet switching has been so successful, not only in improving the economics of data communications but in enhancing reliability and functional flexibility as well, that in 1978 virtually all new data networks being built throughout the world are based on packet switching. An open question at this time is how long will it take for voice communications to be revolutionized as well by packet switching technology. In order to better understand both the past and future evolution of this fast moving technology, this paper examines in detail the history and trends of packet switching.