Hi, koolraj09, it does seem quite a complicated and forbidding definition at first sight, but it's useful in analysis for making rigorous statements about limits. Once you get the hang of it, you might find it helpful to think about ways of paraphrasing the definition that sound more intuitive to you.
There's a nice, gentle introduction to the idea in these two videos from the
Khan Academy:
http://www.khanacademy.org/video/epsilon-delta-limit-definition-1?playlist=Calculus
http://www.khanacademy.org/video/epsilon-delta-limit-definition-1?playlist=Calculus
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Suppose we have a real-valued function of real numbers, f: \mathbb{R} \rightarrow \mathbb{R}. (That means the input of f is a real number, and so is the output.) To call a real number, L, the limit of f(x) (the outputs) as the independent variable x (the input) approaches a specific real number x_0 is to say this:
"Think of a positive real number, any positive real number, \epsilon, representing a distance of \epsilon units away from L. No matter what distance, \epsilon, you thought of, however small, I can always give you at least one positive real number, \delta (which could be different for different epsilons), representing a distance of \delta units away from x_0, such that the following statement is true.
If the input, x, is less than distance \delta away from x_0, then the output, f(x) will be less than distance \epsilon away from L."
In other words, for L to be the limit, the stuff in bold has to be true for every real number \epsilon.
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More formally, for L to be the limit of f(x) as x approaches x_0 means that for every real number, \epsilon > 0, there exists a real number, \delta > 0, such that if |x - x_0| < | \delta - x_0 |, then |f(x) - L| < \epsilon.
In that case, we write
\lim_{x\rightarrow x_0} f(x) = L.
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By choosing an appropriate definition of distance, as Chiro discusses, the idea of the epsilon-delta limit can also be applied to Euclidean spaces with more than one dimension, and to other
metric spaces. But you don't need to know about these generalisations to understand it in one dimension.