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System
A System is a set of interacting System Components:
By "interacting" above (or elsewhere, by Interaction) we mean that the System Components are exchanging Input-Outputs, which typically are Energy, Force, Material, or Information, resulting in change of State of the System Components.
By "State" we mean the condition of a System Component which impacts its behavior during Interactions. By "behavior" of a System Component, we mean its Input-Output relations, parameterized by its State.
From the above, we see that the behavior of a System Component is impacted by its State. Additionally, and in circular fashion, the State of a System Component is in turn impacted by Interactions in which it participates:

A System Component may itself be a System. So, without loss of generality, we may treat "System Component" as an alias for "System".
When a System interacts with external actors, that System acts as a System Component, and exhibits "higher level" behavior and state associated with that "higher level" System Component. Much of the explanatory content of the physical sciences is concerned with how the higher system's behavior emerges, through interaction, from the lower components' behavior.