On one hand, LAN stands for Local Area Network that connects computers within a relatively short distance using network media. LAN is usually applied in residential, school, and office places. On the other hand, WAN is short for Wide Area Network, which holds connectivity in a wider geographic coverage. A WAN consists of a series of LANs as well, and it exists under distributed ownership and online connections. The Internet is the largest WAN.
In setting up a LAN, at least two computers are necessary. Computers that will be connected into the LAN must be equipped with ethernet network interface / NICs. A network hub is ideal to use, too. The hub will be the main point where all computers will be connected to. Network hubs vary in the number of ports it they consists; typical network hubs would contain five.
Regarding cabling, a CAT5 ethernet cable is required; it contains six-pin connectors. These kinds of cables are easy to purchase at most computer stores. When purchasing cables and NICs, it is best to consult with a friendly salesman at a nearby computer store so you can purchase the correct ones.
With WAN, the computer creates one LAN and then connect it to the Internet WAN with a help of an Internet Service Provider. The ISP later on creates a WAN IP address unique with every modem. Each computers connected to the WAN have their own private IP addresses, too. A router serves as a gateway and main point connecting every computers and to reach the ISP. Data transfer rates apply when using WAN.
These two are the most popular network types available, more specific categories have emerged over many years of technology.