The simplest liquid crystal phase is the nematic. In a nematic phase,  organic molecules lack a crystalline positional order, but do self-align with their long axes roughly parallel. The molecules are free to flow and their center of mass positions are randomly distributed as in a liquid, but their orientation is constrained to form a long-range directional order. 
The word nematic comes from the Greek  (), which means "thread". This term originates from the disclinations: thread-like topological defects observed in nematic phases.  
Nematics also exhibit so-called "hedgehog" topological defects. In two dimensions, there are topological defects with topological charges  and . Due to hydrodynamics, the  defect moves considerably faster than the  defect. When placed close to each other, the defects attract; upon collision, they annihilate. 
Most nematic phases are uniaxial: they have one axis (called a directrix) that is longer and preferred, with the other two being equivalent (can be approximated as cylinders or rods). However, some liquid crystals are biaxial nematic, meaning that in addition to orienting their long axis, they also orient along a secondary axis. Nematic crystals have fluidity similar to that of ordinary (isotropic) liquids but they can be easily aligned by an external magnetic or electric field. Aligned nematics have the optical properties of uniaxial crystals and this makes them extremely useful in liquid-crystal displays (LCD).
Nematic phases are also known in non-molecular systems: at high magnetic fields, electrons flow in bundles or stripes to create an "electronic nematic" form of matter.