Can you explain transaction isolation levels?

SQL defines four transaction isolation levels that control how concurrent transactions interact:

1. Read Uncommitted – allows dirty reads; a transaction can see uncommitted changes from others.
2. Read Committed – the default in many systems; a transaction sees only committed data, preventing dirty reads but still allowing non‑repeatable reads.
3. Repeatable Read – ensures that if a transaction reads a row twice, it sees the same data; it prevents non‑repeatable reads but may allow phantom rows.
4. Serializable – the strictest level; transactions are executed as if they were serialized, preventing dirty reads, non‑repeatable reads, and phantom reads.

Choosing the level balances consistency with concurrency. For example, a banking system may use Serializable for balance updates, while a reporting system may use Read Committed to improve throughput.