Bit: short form for binary digit. It is either a 0 or a 1 (binary code).
1 byte= 8 bits.
1 kilobyte = 1024 bytes.
1 megabyte = 1024 kilobytes.
1 megabyte=1024*1024=1,048,576 bytes and 1 byte=8 bits, and 1 megabyte (1048576) is just 8,388,608 bits, then 1 megabit is approximately .125 megabytes.
Generally - Bits are used to talk about data transfer rates (1 kilobit = 1000 bits), while bytes are used to talk about storage size calculations (1 kilobyte = 1024 bytes). So when your Internet provider offers you a 1Mb connection, its megaBits not MegaBytes. So for a rough guide of how MUCH you can download, divide by eight. i.e. 1Mb speed = 128KB of data.