Timer ticks, network cards and keyboard are examples of real hardware which produce interrupts at any time. The kernel runs interrupt handlers, which services the hardware. The kernel guarantees that this handler is never re-entered: if the same interrupt arrives, it is queued (or dropped). Because it disables interrupts, this handler has to be fast: frequently it simply acknowledges the interrupt, marks a 'software interrupt' for execution and exits.

You can tell you are in a hardware interrupt, because in_irq() returns true.