First, Oracle parses the statement and ensures that the statement is syntactically correct and semantically correct. Next, Oracle verifies that the user has permissions to perform the statement. If the user can execute the statement, Oracle obtains all locks necessary for the statement to complete. Once the locks have all been obtained, Oracle executes the statement. In some cases, results are returned. If results are returned from the statement, Oracle fetches those results and places the result set in an area called a 'cursor'. The cursor is passed back to the application.
That's the basics anyway! There are variations depending on the exact command being given.
SOURCE : http://searchoracle.techtarget.com/expert/KnowledgebaseAnswer/0,289625,sid41_gci1309863,00.html?track=NL-390&ad=638910&asrc=EM_NLT_3601016&uid=5766966
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