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On the data-link layer lies the distinction between switched and unswitched networks. On an unswitched network, Ethernet packets pass through every device on the network, expecting each system device to only look at the packets sent to its destination address. However, it's fairly trivial to set a device to promiscuous mode, which causes it to look at all packets, regardless of the destination address. Most packet-capturing programs, such as tcpdump, drop the device they are listening to into promiscuous mode by default. Promiscuous mode can be set using ifconfig, as seen in the following output.
reader@hacking:~/booksrc $ ifconfig eth0
eth0 Link encap:Ethernet HWaddr 00:0C:29:34:61:65
UP BROADCAST RUNNING MULTICAST MTU:1500 Metric:1
RX packets:17115 errors:0 dropped:0 overruns:0 frame:0
TX packets:1927 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:1000
RX bytes:4602913 (4.3 MiB) TX bytes:434449 (424.2 KiB)
Interrupt:16 Base address:0x2024
reader@hacking:~/booksrc $ sudo ifconfig eth0 promisc
reader@hacking:~/booksrc $ ifconfig eth0
eth0 Link encap:Ethernet HWaddr 00:0C:29:34:61:65
UP BROADCAST RUNNING PROMISC MULTICAST MTU:1500 Metric:1
RX packets:17181 errors:0 dropped:0 overruns:0 frame:0
TX packets:1927 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:1000
RX bytes:4668475 (4.4 MiB) TX bytes:434449 (424.2 KiB)
Interrupt:16 Base address:0x2024
reader@hacking:~/booksrc $