The Software Clock, HZ, and Jiffies
The accuracy of various system calls that set timeouts, (e.g., select(2), sigtimedwait(2)) and measure CPU time (e.g., getrusage(2)) is limited by the resolution of the software clock, a clock maintained by the kernel which measures time in jiffies. The size of a jiffy is determined by the value of the kernel constant HZ.
The value of HZ varies across kernel versions and hardware platforms. On i386 the situation is as follows: on kernels up to and including 2.4.x, HZ was 100, giving a jiffy value of 0.01 seconds; starting with 2.6.0, HZ was raised to 1000, giving a jiffy of 0.001 seconds. Since kernel 2.6.13, the HZ value is a kernel configuration parameter and can be 100, 250 (the default) or 1000, yielding a jiffies value of, respectively, 0.01, 0.004, or 0.001 seconds. Since kernel 2.6.20, a further frequency is available: 300, a number that divides evenly for the common video frame rates (PAL, 25 HZ; NTSC, 30 HZ).
The times(2) system call is a special case. It reports times with a granularity defined by the kernel constant USER_HZ. Userspace applications can determine the value of this constant using sysconf(_SC_CLK_TCK).
High-Resolution Timers
Before Linux 2.6.21, the accuracy of timer and sleep system calls (see below) was also limited by the size of the jiffy.
Since Linux 2.6.21, Linux supports high-resolution timers (HRTs), optionally configurable via CONFIG_HIGH_RES_TIMERS. On a system that supports HRTs, the accuracy of sleep and timer system calls is no longer constrained by the jiffy, but instead can be as accurate as the hardware allows (microsecond accuracy is typical of modern hardware). You can determine whether high-resolution timers are supported by checking the resolution returned by a call to clock_getres(2) or looking at the "resolution" entries in /proc/timer_list.
HRTs are not supported on all hardware architectures. (Support is provided on x86, arm, and powerpc, among others.)