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A dual-core CPU combines two independent processors and their respective caches and cache controllers onto a single silicon chip, or integrated circuit.

http://en.wikipedia.org/wiki/Dual_Core_Processors

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A dual core processor is a CPU with two separate cores on the same die, each with its own cache. It's the equivalent of getting two microprocessors in one.

In a single-core or traditional processor the CPU is fed strings of instructions it must order, execute, then selectively store in its cache for quick retrieval. When data outside the cache is required, it is retrieved through the system bus from random access memory (RAM) or from storage devices. Accessing these slows down performance to the maximum speed the bus, RAM or storage device will allow, which is far slower than the speed of the CPU. The situation is compounded when multi-tasking. In this case the processor must switch back and forth between two or more sets of data streams and programs. CPU resources are depleted and performance suffers.

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