Formula One consists of a series of races, known as Grand Prix, held on purpose-built circuits or closed city streets, whose results determine two annual World Championships, one for drivers and one for constructors. The cars race at speeds often in excess of 320 km/h (200 mph) with engines that produce, as of 2007, around 900 bhp at 18000 rpm and are capable of pulling up to 5g in some corners. The performance of the cars is highly dependent on electronics, aerodynamics, suspension and tyres. The formula has seen many evolutions and changes through the history of the sport.

Europe is F1's traditional centre and remains its leading market; however, Grands Prix with others picking up, its scope is continuously expanding. F1 cars are the most expensive race cars currently in production and the sport is the most expensive as well. As such, its economic impact is significant, and its financial and political battles are widely observed. In recent years, it has also become known for glamour.

The sport is regulated by the Fédération Internationale de l'Automobile (FIA), whose president is Max Mosley, and is generally promoted and controlled by Bernie Ecclestone through a variety of corporate entities.

In March 2007 F1 Racing published its annual estimates of spending by Formula One teams. The total spending of all eleven teams in 2006 was estimated at $2.9 billion. This was broken down as follows; Toyota $418.5 million, Ferrari $406.5 m, McLaren $402 m, Honda $380.5 m, BMW Sauber $355 m, Renault $324 m, Red Bull $252 m, Williams $195.5 m, Midland F1/Spyker-MF1 $120 m, Toro Rosso $75 m, and Super Aguri $57 million.

Costs vary greatly from team to team; in 2006 teams such as Honda, Toyota, McLaren-Mercedes and Ferrari are estimated to have spent approximately $200 million on engines, Renault spent approximately $125 million and Cosworth's 2006 V8 was developed for $15 million. In contrast to the 2006 season on which these figures are based, the 2007 sporting regulations ban all performance related engine development.