In 1906, Stuart W. Cramer of Charlotte was exploring ways to add moisture to the air in his textile mill. Cramer coined the term "air conditioning", using it in a patent claim he filed that year as an analogue to "water conditioning", then a well-known process for making textiles easier to process. He combined moisture with ventilation to "condition" and change the air in the factories, controlling the humidity so necessary in textile plants. Willis Carrier adopted the term and incorporated it into the name of his company.
An air conditioner's compressor contains a refrigerant. As it works, it sends this refrigerant through the system. As warm air blows across the coil that carries this refrigerant, the heat transfers to the refrigerant (cool always absorbs warm). A fan moves the cooled air through the ducting and out of vents that lead into the rooms of your house. The refrigerant returns to the compressor where the absorbed heat is moved outside. The refrigerant is then sent through the coil once again to continue the cycle.