A contract is generally a written or spoken agreement between persons or entities that includes obligations for each party (mutual obligations or mutuality) and enough specific information to be enforceable by either party (specificity).

The elements of forming an enforceable contract are generally (1) an offer made; (2) acceptance of the offer; and (3) consideration given by each party for the other party’s performance of the agreement—such as money in exchange for products or services, or mutual promises exchanged—which is often referred to as the bargained-for exchange.

The word "agreement" is often used interchangeably with the word "contract," and a document labeled as an agreement (with the necessary legal elements included) is as enforceable as a document labeled as a contract.

In Illinois, as in other states, a contract is a legally binding agreement between parties that creates mutual obligations. The essential elements for forming an enforceable contract in Illinois include (1) an offer, (2) acceptance of that offer, and (3) consideration, which refers to the value exchanged between the parties, such as money, services, or mutual promises. The contract must also have sufficient specificity to be enforceable, meaning it must clearly outline the terms and conditions of the agreement so that a court can determine each party's obligations. While the terms 'agreement' and 'contract' can be used interchangeably, the enforceability of the document hinges on the presence of these legal elements, not the label used. Therefore, a document titled 'agreement' that contains the necessary elements can be as enforceable as one labeled 'contract'. Illinois follows the common law principles of contract formation, and these principles are applied by Illinois courts to determine the validity and enforceability of contracts.