The ATC system is based on the earlier Anatomical Classification System, which is intended as a tool for the pharmaceutical industry to classify pharmaceutical products (as opposed to their active ingredients). As of, there are 6,331 codes in ATC the table below gives the count per level. The codes are semantic identifiers, meaning they depict information by themselves beyond serving as identifiers (namely, the codes depict themselves the complete lineage of parenthood).

The ATC classification system is a strict hierarchy, meaning that each code necessarily has one and only one parent code, except for the 14 codes at the topmost level which have no parents. This means that one drug can have more than one code, for example acetylsalicylic acid (aspirin) has A01AD05 ( WHO) as a drug for local oral treatment, B01AC06 ( WHO) as a platelet inhibitor, and N02BA01 ( WHO) as an analgesic and antipyretic as well as one code can represent more than one active ingredient, for example C09BB04 ( WHO) is the combination of perindopril with amlodipine, two active ingredients that have their own codes ( C09AA04 ( WHO) and C08CA01 ( WHO) respectively) when prescribed alone. Each bottom-level ATC code stands for a pharmaceutically used substance, or a combination of substances, in a single indication (or use).

Different brands share the same code if they have the same active substance and indications. This pharmaceutical coding system divides drugs into different groups according to the organ or system on which they act, their therapeutic intent or nature, and the drug's chemical characteristics.

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