Bell Laboratories (usually Bell Labs) was the research arm of the Bell system. It did basic research in fields useful to Bell (Bells Labs researchers received numerous Nobel prizes in physics), as well as applied research, but its primary purpose was to develop telecommunications gear for the Bell system.
Among notable achievements of Bell Labs were important early work on semiconductors (the key technology in all of modern electronics - in the late 1930s); the transistor (in 1947); and UNIX (in the early 1970s).
The roots of Bell Labs date back to 1883, when the Mechanical Department of AT&T was set up; in 1907 the engineering departments of Western Electric (the Bell subsidiary which actually manufactured all the hardware for the Bell system) and AT&T were unified in New York City. Bell Labs as an independent company was set up as subsidiary of AT&T in 1925, and moved to Murray Hill, New Jersey.
After AT&T was split into three companies in 1996–97 (and even more, shortly thereafter, as the Regional Basic Operating Companies were split off), most of the Labs wound up with one of them, Lucent Technologies, which took over Western Electric's role as a manufacturer of telecommunications equipment; a small part remained with AT&T. In 2006, Lucent Technologies (including its portion of Bell Labs) merged with Alcatel; the combined firm, Alcatel-Lucent; was acquired by Nokia in 2016.