Tube, Docklands Light Railway (DLR), London Overground and National Rail services in London are divided into zones. Most services operate in zones 1-6, with Tube, London Overground and National Rail also operating in zones 7-9.
If you use a Travelcard, it must be valid for every zone you travel through. (Travelcards are valid for any bus journey within Greater London regardless of the zone(s) it covers. Where your Travelcard includes Zone 3, 4, 5 or 6 you can use it on trams.)
Oyster is valid for all zones and automatically calculates the cheapest fare.