In the past most signalling schemes relied on detecting the presence of a signal in a single wire, compared to ground. For instance, the widely used RS-232 system uses +/- 12V to represent a signal, and anything less than +/- 5V to represent the lack of a signal. The high voltage levels used to make the signals largely immune to noise, since few naturally occurring signals can create that sort of voltage. They also have the advantage of requiring only one wire per signal.
However they also have a serious disadvantage: they cannot run at high speeds. The effects of capacitance and inductance, which filter out high-frequency signals, effectively throttle speed. One can reduce this problem by using smaller voltages. However when using smaller voltages, the chance of mistaking random environmental noise for signal becomes much more of a problem.
LVDS relies on detecting not the voltage with respect to ground, but the difference in voltage between two wires. The LVDS system injects a small current, about 3 milliamps, into one wire or the other and that current returns in the opposite direction along the other wire. The voltage difference between the two wires comprises about 300 millivolts. The small amplitude of the signal reduces the effects of capacitance and inductance. The system also reduces problems with noise, because noise sources tend to add the same amount of voltage (called common-mode noise) to both wires, so the difference between the voltages remains the same. Manufacturers can further reduce noise by twisting the two wires of a pair together, so that noise induced in one half-twist tends to cancel the noise induced in the neighbouring half-twist.
LVDS only became popular in the latter half of the 1990s. Prior to that point it could signal faster than the computers it was running in, and the need to run twice as many wires for the same amount of data outweighed the speed benefits. Yet multimedia and supercomputer users, both of whom needed to move large amounts of data over links several meters long (from a disk drive to a workstation, for instance) maintained a widespread interest in LVDS.
Two examples of LVDS use in computer buses come from HyperTransport and FireWire, both of which trace their ancestry back to the post-Futurebus work which also led to SCI.
LVDS can also transport video data from graphics adapters to computer monitors, particularly flat panels, using the Flat Panel Display (FPD) Link, LVDS Display Interface (LDI) and OpenLDI standards. These standards allow a maximum pixel clock of 112 MHz, which suffices for a display resolution of 1400 x 1050 (SXGA+) at 60 Hz refresh. A dual link can also boost the maximum display resolution to 2048 x 1536 (QXGA) at 60 Hz. FPD-Link works with cable lengths up to about 5 m, and LDI extends this to about 10 m.