The Ferdinand Porsche–designed Auto Union Type C is credited as the first automotive use of a limited-slip differential, ...

The positive-locking differential physically locks the axle shafts together through splines. A limited slip does what its name implies: It allows a limited amount of slippage between the axles.

To understand the benefits of a limited-slip differential you have to understand the basic components involved in turning a car’s engine power into forward (or reverse) movement.