The OS layer that interacts with a network either as a participant (networked OS) or as something to be abstracted away (distributed OS). The distinction is who knows about the network: the user or the OS.
Networking versus Distributed OS
Networked OS
A networked operating system provides support for network operations. The users manage the networked applications and commands. Each host is autonomous.
Distributed OS
Tries to abstract the network from the user and thereby remove the need for the user to specify how the networking commands and operations should be undertaken.