The Collaborative International Dictionary of English v.0.48:

Bit \Bit\ (Computers) [binary digit.]
   1. the smallest unit of information, equivalent to a choice
      between two alternatives, as yes or no; on or off.
      [PJC]

   2. (Computers) the physical representation of a bit of
      information in a computer memory or a data storage medium.
      Within a computer circuit a bit may be represented by the
      state of a current or an electrical charge; in a magnetic
      storage medium it may be represented by the direction of
      magnetization; on a punched card or on paper tape it may
      be represented by the presence or absence of a hole at a
      particular point on the card or tape.
      [PJC]

   Bit my bit, piecemeal. --Pope.
      [1913 Webster]