diff --git a/README.md b/README.md
index d5bcd38..55bea93 100644
--- a/README.md
+++ b/README.md
@@ -3,7 +3,7 @@ Red Hat Certified Specialist in Ansible Automation (EX407) Preparation Course
 
 - [Understanding Core Components of Ansible](#understanding-core-components-of-ansible)
     - [Understanding Core Components of Ansible Part 1](#understanding-core-components-of-ansible-part-1)
-
+    - [Understanding Core Components of Ansible Part 2](#understanding-core-components-of-ansible-part-2)
 
 ## Understanding Core Components of Ansible
 ### Understanding Core Components of Ansible Part 1
@@ -42,4 +42,67 @@ innaghiyev1c.mylabserver.com | SUCCESS => {
     "changed": false,
     "ping": "pong"
 }
-```
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+```
+
+### Understanding Core Components of Ansible Part 2
+This series of lessons lays the foundation for the remainder of the course content. Through a combination of lecture and command line demonstration, Students will gain a broad overview of Ansible. This particular lesson covers the following topics at a very high level: modules, variables, facts, plays, playbooks, and configuration files.
+  
+- Modules
+  - Modules are essentially tools for particular tasks
+  - Modules can take (and usually do) take parameters
+  - They return JSON
+  - Can run from the command line or within a playbook
+  - There are a significant number of modules for many kinds of work
+  - Custom modules can be written
+  
+- Variables
+  - Variable names should be letters, numbers and underscores
+  - Variables should always start with a letter
+  - Can be scoped by a group, host, or even ini a playbook
+  - Typically used for configuration values and various parameters 
+  - Variables can also be used to store the return value of executed commands
+  - Ansible variables may also be dictionaries
+  - There are a number of predefined variables used by Ansible 
+  
+- Facts
+  - Facts provide certain information about given target host
+  - Facts are discovered by Ansible automatically when it reaches out to a host
+  - Fact gathering may be disabled
+  - Facts may be cached between playbook executions, but this is not default behavior
+
+```
+innaghiyev1c.mylabserver.com | SUCCESS => {
+    "ansible_facts": {
+        "ansible_all_ipv4_addresses": [
+            "172.31.37.72"
+        ],
+        "ansible_all_ipv6_addresses": [
+            "2a05:d01c:2c7:d802:4db1:18cc:f13f:a1cf",
+            "fe80::9e:19ff:fe1e:7376"
+        ],
+        "ansible_apparmor": {
+            "status": "enabled"
+        },
+        "ansible_architecture": "x86_64",
+        "ansible_bios_date": "10/16/2017",
+        "ansible_bios_version": "1.0",
+```
+
+- Plays and playbooks
+  - The goal of a play is to map a group of hosts to some well-defined roles
+  - A play may use one or more modules to achieve a desired end state on a group of hosts
+  - A playbook is a series of plays
+  - A playbook may deploy new web servers, install a new application to existing application servers, and run SQL against some database servers to support the new application
+  
+- Configuration Files
+  - Several possible locations (in order processed):
+    - ANSIBLE_CONFIG (an environment variable)
+    - ansible.cfg (in the current directory)
+    - .ansible.cfg (in the home directory)
+    - /etc/ansible/ansible.cfg (master configuration)
+  - Configuration can also be set in environment variables
+  - Some commonly used settings:
+    - ansible_managed
+    - forks
+    - Inventory
+    
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