Oxidation states, also known as oxidation numbers, indicate the degree of oxidation of an atom in a chemical compound. They help in understanding how electrons are distributed among atoms in a molecule. The oxidation state is usually represented as a positive or negative integer, reflecting the number of electrons lost or gained by an atom compared to its elemental form. In a compound, the sum of the oxidation states of all atoms must equal the overall charge of the molecule. For example, in water (H₂O), the oxidation state of hydrogen is +1, while that of oxygen is -2, resulting in a net charge of 0.