How do environment variables work in Next.js (the NEXT_PUBLIC_ prefix)?

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**Target Audience:** Frontend engineers preparing for Next.js interviews — assumes basic React and App Router familiarity.
**Difficulty:** Easy

> **How to read this doc:** Each idea is explained in plain language first, then tagged with `📌 Interview term:`. Every behaviour claim was checked against the Next.js docs shipped with the package (written on 16.3.4, re-reviewed against 16.4.2) and, in the **Verified** section, against real output from a build or a running server; each Verified block

NEXT.JSDECODED.

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How do environment variables work in Next.js (the NEXT_PUBLIC_ prefix)?