The smallest unit of a compound is called a molecule. Molecules are formed when two or more atoms bond together through chemical bonds, such as covalent or ionic bonds. The composition and arrangement of these atoms determine the compound's properties and behavior. For example, a water molecule (H2O) consists of two hydrogen atoms and one oxygen atom. Understanding molecules is fundamental to chemistry, as they serve as the building blocks for more complex structures and play a key role in chemical reactions and interactions.