Baseband, or digital, signaling is based on the use of discrete states to convey information across a communications channel. These discrete states are typically represented as pulses of some sort (such as voltage) and are thus often called square waves. Below Image shows a square wave by which two discrete states (0 and 1) can be represented each by a different voltage (plus and minus 12 volts in the picture below).

Many different baseband signaling schemes have been developed over the years; a few of the most popular are shown in the image below. At the top of the figure is a uni-polar signaling scheme, in which a digital 1 is represented by a +5 volt state and a digital 0 is represented by a no voltage (ground) state. This scheme was widely used in early transistor-transistor logic (TTL) circuitry. In the middle of the figure is a bipolar signaling scheme, in which a digital 1 is represented by a –12volt state and a digital 0 is represented by a +12volt state. This scheme is widely used today in a Physical layer protocol known as EIA-232-E. At the bottom of the figure is a bipolar return to zero (BPRZ) scheme in which digital 0s are represented by a no voltage (ground) state and digital 1s are represented by alternating 3-volt pulses.

This latter scheme, sometimes called alternate mark inversion (AMI), is used on T-1 lines by carriers and customers alike. As we have seen, each of these baseband signaling schemes has either seen widespread use in the past or is in widespread use today. A major determinant of the choice to use one baseband scheme over another has to do with the ease with which timing and synchronization is supported by the technique.