External cache is part of the main random access memory (RAM) or an independent component installed on the motherboard. Some external caches are built and integrated on the processor dye itself, but not directly the part of it.

It serves as an intermediate memory between the processor and RAM. External cache is implemented in several layers - all providing different speeds and capacity levels. For example, L2 and L3 caches are common examples or layers of external cache. A L2 cache is faster but has less storage capacity than a L3 cache.