In a typical RFID system, individual objects are equipped with a small, inexpensive tag which contains a transponder with a digital memory chip that is given a unique electronic product code. The interrogator, an antenna packaged with a transceiver and decoder, emits a signal activating the RFID tag so it can read and write data to it. When an RFID tag passes through the electromagnetic zone, it detects the reader's activation signal. The reader decodes the data encoded in the tag's integrated circuit (silicon chip) and the data is passed to the host computer for processing.
RFID tags come in a wide variety of shapes and sizes. Some tags are easy to spot, such as the hard plastic anti-theft tags attached to merchandise in stores. Animal tracking tags which are implanted beneath the skin of family pets or endangered species are no bigger than a small section of pencil lead. Even smaller tags have been developed to be embedded within the fibers of a national currency.
While barcodes have historically been the primary means of tracking products, RFID systems are rapidly becoming the preferred technology for keeping tabs on people, pets, products, and even vehicles. One reason for this is because the read/write capability of an active RFID system enables the use of interactive applications. Also, the tags can be read from a distance and through a variety of substances such as snow, fog, ice, or paint, where barcodes have proved useless.
Currently, RFID tags are not widely used in consumer products because the price of the tags is still prohibitively expensive. However, as companies push for enhanced means of tracking products and profiling consumers, the increased demand and production of RFID technologies will drive down prices.
Already, developments in RFID technology are yielding systems with larger memory capacities, wider reading ranges, and faster processing. In response, the market for RFID tags is growing explosively, projected to reach $10 billion annually within the decade.
With the interest in this technology growing rapidly you'll see more and more suppliers jumping at the chance to provide the tools and resources to implement it.
There are many resources availbale to obtain this information, and while I can't possibly list them all here I have put some of them together for you.
some of the information on this page was provided by http://www.epic.org/privacy/rfid/