c# Generics

Generics are the most powerful feature of C# 2.0. Generics allow you to define type-safe data structures, without committing to actual data types. This results in a significant performance boost and higher quality code, because you get to reuse data processing algorithms without duplicating type-specific code. In concept, generics are similar to C++ templates, but are drastically different in implementation and capabilities

A Good example to know genrics importance  is Stack functionality which has push and pop functionality .

Before Generics we used a amorphous object datatype (under c# 1.1)

Object based Stack : Object is the canonical .NET base type, you can use the Object-based stack to hold any type of items, such as integers:

Stack stack = new Stack();
stack.Push(1);
stack.Push(2);
int number = (int)stack.Pop();

Code block 1. An Object-based stack

public class Stack
{
   readonly int m_Size; 
   int m_StackPointer = 0;
   object[] m_Items; 
   public Stack():this(100)
   {}   
   public Stack(int size)
   {
      m_Size = size;
      m_Items = new object[m_Size];
   }
   public void Push(object item)
   {
      if(m_StackPointer >= m_Size) 
         throw new StackOverflowException();       
      m_Items[m_StackPointer] = item;
      m_StackPointer++;
   }
   public object Pop()
   {
      m_StackPointer--;
      if(m_StackPointer >= 0)
      {
         return m_Items[m_StackPointer];
      }
      else
      {
         m_StackPointer = 0;
         throw new InvalidOperationException("Cannot pop an empty stack");
      }
   }
}

However, there are two problems with Object-based solutions. The first issue is performance. When using value types, you have to box them in order to push and store them, and unbox the value types when popping them off the stack. Boxing and unboxing incurs a significant performance penalty in their own right, but it also increases the pressure on the managed heap, resulting in more garbage collections, which is not great for performance either. Even when using reference types instead of value types, there is still a performance penalty because you have to cast from an Object to the actual type you interact with and incur the casting cost:

Generics:
Generics allow you to define type-safe classes without compromising type safety, performance, or productivity. You implement the server only once as a generic server, while at the same time you can declare and use it with any type. To do that, use the < and > brackets, enclosing a generic type parameter. For example, here is how you define and use a generic stack:

public class Stack<T>
{
   T[] m_Items; 
   public void Push(T item)
   {...}
   public T Pop()
   {...}
}
Stack<int> stack = new Stack<int>();
stack.Push(1);
stack.Push(2);
int number = stack.Pop();

For more informatioin see : http://msdn.microsoft.com/en-us/library/ms379564(v=vs.80).aspx