The objective of this report is to discuss about the key components of Internet of Things (IoT), what constitute IoT and how it should be implemented. After briefing about IoT, the study dives deep into what comprises an IoT system, common challenges faced by companies and organizations in implementing it. Thereafter the solution is provided with the help of a network diagram, the working of which is explained below. Then comes the recommended section where the report provides the necessary suggestions as per observations drawn from the analysis. Following which the report concludes that the challenges should carefully be looked into for proper implementation of IoT.