A System is delineated from it’s surrounding’s by a boundary. We are concerned with closed systems, which prohibit mass transfer across the boundary, and with open systems, or control volumes, which allow mass transfer, and are generally defined by a particular spatial volume.
Closed System (left) with constant mass, $m=c$, and Open System (right) with inlet mass flux, $\dot m_i$, and outlet mass flux, $\dot m_e$.
Systems exhibit properties, the collection of which specify the state of the system. These include extensive and intensive properties. Extensive properties include those related to the extent, or size, of the system, such as total mass and total volume. Intensive properties include those related to the intensity, or characteristic of the system, such as pressure at a specific location and time. Extensive properties pertain to the system as a whole, whereas intensive properties can vary across a system and pertain to certain locations.
Example extensive properties, mass and volume, and example intensive properties, specific volume and temperature. (”Specific” volume is the volume per unit mass, $v=V/m$)
The state of a system includes all of the properties of the system. However, the state may often be determined, or specified by a subset of its properties. Identifying a small number of properties that can specify the thermodynamics state is a crucial problem solving method. For example, given a system of steam, the temperature and pressure can be used to determine the specific volume, specifying the state.
Processes are the transitions from one state to another. By identifying how properties change through the process, we can relate the properties of one state to another, specifying one state based on the other. This is another crucial problem solving technique.
Our ambient atmosphere has a certain pressure, around $15~(\frac{lbs}{in^2})$. As such, it is often useful to use a relative pressure scale. This relative pressure is the gage pressure. For example, if you inflate a tire to $45~(\frac{lbs}{in^2})$, the absolute pressure inside is actually around $60~(\frac{lbs}{in^2})$.