An alloy is a combination, either in solution or compound, of two or more elements, at least one of which is a metal, and where the resulting material has metallic properties. The resulting metallic substance generally has properties significantly different from those of its components.
Steel is a metal alloy whose major component is iron, with carbon content between 0.02% and 1.7% by weight.
Alloys are usually designed to have properties that are more desirable than those of their components. For instance, steel is stronger than iron, one of its main elements. It 'inherits' some of the characteristics of the elements it was made from, usually physical properties like density, reactivity and electrical and thermal conductivity. However, its engineering properties, like tensile strength, Young's modulus and shear strength, can be vastly different from its constituent materials.