If you have ever wondered if there is any difference between the Upstream and Downstream O2 sensors; the answer is "yes"!
Upstream Sensor is in the Exhaust Manifold Pre-Cat
Downstream Sensor is in the Exhaust Pipe Post-Cat
Second difference: (and most important)
There is a reason why the Upstream O2 sensor is about 2-3x more expensive than the downstream sensor. It is what tells your cars ECU when the AFR goes rich, stoic, or lean. This allows your computer to advance or retard timing in order to prevent knock or detonation from occurring.
The Downstream O2 sensor is used to tell the ECU if the emissions system is working correctly... that's about all it does.
When you get your check engine light, nearly 90% of the time it will be the O2 sensor... (or so it seems, no real data to back that statistic up).
If the code is in reference to the Upstream sensor, then it is important to replace the sensor as soon as practical. Very important to avoid boost or WOT driving.
If the code is in reference to the Downstream sensor, then it is important to ensure that your Catalytic Converter is not fouled up and causing an excess restriction on your engines exhaust flow.
Hope this clears up any confusion as I found numerous forum sites stating that there is no real difference between the two except location, and as I used a new Downstream to plug the hole in my exhaust manifold (upstream) in order to get my car home the check engine light and Accessport state the Upstream sensor is bad, even after two ECU resets.
I know this is an old thread, but many (including myself) use these for reference well after posting.
Most of what Raszaron stated is correct, with one large (and one small) exception:
In NO car does input from front or rear O2 sensors effect the ignition timing. The front O2 sensors are responsible ONLY for trimming the fuel/air mixture...making small adjustments after baselines are set by the mass air flow sensor. In turbocharged engines, further fuel/air trimming is done according to input from exhaust gas temperature sensors. This trimming (by input from both front O2 and EGT sensors) does indeed have a major impact on emissions and fuel economy.
BUT, ignition timing is NOT adjusted by ANY input from 02 sensors...timing is adjusted by input from knock sensors, while ignition timing is constantly advanced to the point where predetonation is detected. More ignition timing advance = more power and cooler running.
And, although true that secondary O2 sensors are just there to check & report the performance of the primary O2 sensors (and other systems), they are very often exactly the same sensors heads as the primaries and often cost just as much...the case in my car. The rear O2 sensors supply the same information as the front ones, but the signal is simply used for a different purpose by the ECU...but not to adjust ignition timing.