DTMF (Dual-Tone Multi-Frequency) is an audio signal combining two frequencies, generated when a button on a phone is pressed. Also called touch-tone or tone signaling, it has been used since the 1960s to carry digit information between telephones and exchanges.
DTMF sounds two tones at once, one from the low group (697/770/852/941 Hz) and one from the high group (1209/1336/1477 Hz), and the combination identifies which key was pressed. For example, "1" is 697 Hz + 1209 Hz, and "5" is 770 Hz + 1336 Hz. Two simultaneous frequencies are used to prevent false detection from human voices or ambient noise: a single frequency could be matched by coincidence, whereas the chance of two specific frequencies occurring together is extremely low.
Twelve signals are defined as standard: the digits 0-9 plus * (asterisk) and # (hash). Four further signals, A to D, are specified as a fourth column that adds 1633 Hz to the high group, but ordinary telephones do not carry those keys.
The most familiar use of DTMF is operating IVR (Interactive Voice Response) systems. When you follow a prompt such as "press 1 for ..." the DTMF signal reaches the system and routes the call to the matching menu. DTMF is also what carries a PIN entered in telephone banking. In VoIP environments, the tones may be passed through as audio, or sent as digital signals (RTP events) under RFC 4733. The experience is the same for the caller either way, but because the sending method varies between implementations, button presses sometimes fail to register with an IVR on calls placed through an app. Learn the fundamentals of telephone technology in How Japanese Phone Numbers Work - From Area Codes to Mobile Numbers.
In contrast to DTMF (tone) dialing, the "pulse" dialing used by rotary phones interrupts the line in step with the dial rotation. It is slow, and it cannot be used to operate an IVR during a call. Some phones and line contracts still carry a pulse/tone switch setting. Also, because DTMF travels as sound, digits entered during a call can be recovered from a recording of that call. That is why call center recording systems are sometimes operated so that tones are not recorded while a PIN or card number is being keyed in.