The following was taken from the online tutorial:http://www.tutorialspoint.com/python/python_modules.htm

When you import a module, the Python interpreter searches for the module in the following sequences −

(a) The current directory.

If the module isn't found, Python then searches:

(b) each directory in the shell variable PYTHONPATH.

If all else fails, Python checks:

(c) the default path. On UNIX, this default path is normally /usr/local/lib/python/.

The module search path is stored in the system module sys as the sys.path variable. The sys.path variable contains the current directory, PYTHONPATH, and the installation-dependent default.

The PYTHONPATH is an environment variable, consisting of a list of directories. The syntax of PYTHONPATH is the same as that of the shell variable PATH:

set PYTHONPATH=/usr/local/lib/python