In an analog circuit simulation to calculate the voltage/current at any node, simulator requires information about electrical characteristics of each device. This is provided in the form of a set of equations and parameters to the simulator. set of equations used to describe the device characteristics is called model eg: BSIM3 parameters are the variables input to these equations so that the device characteristics from simulation are same as observed in actual measurement for a particular device. eg., of parameters: threshold voltage, mobility. Determining these parameters for a particular device to match simulation and measurement is called parameter extraction. I have a mos fabraicated in silicon. I have some measured data for particular vgs and vds. I use the measurement data and model and extract parameters so that the simulated result is same as measured data. Then using this model I can simulate the device for any vgs and vds and know the output current. This is the need of device modeling. Proper model implies it reflects the fabrication technology exactly.