What distinguishes a stream cipher from a block cipher?

A stream cipher is characterized by its method of encryption, which processes data one bit at a time. This allows for real-time encryption and decryption of data as it is being transmitted, making stream ciphers particularly useful for applications requiring continuous data flows, such as voice over IP or streaming audio. This bit-by-bit approach contrasts with block ciphers, which encrypt data in fixed-size blocks, typically requiring padding for data that does not fit neatly within the specified block size.

The design of stream ciphers may lead to advantages in speed and efficiency for certain types of data handling, especially where low latency is critical. The ability to encrypt data on the fly without waiting for an entire block to accumulate is a crucial differentiator between the two cryptographic methods.