Possible values for "position" attribute are static, relative, absolute, fixed and inherit. The default value of position attribute is "static". Elements are positioned in browser depending of the position attribute; all elements are placed relative to the next parent element which has absolute or relative position declared.
Static is default value and respects normal document flow, absolutely positioned elements removed from document flow, it does not flow around content of other elements, and content from other elements doesn’t flow around absolutely positioned element. Absolutely positioned elements can overlap other elements or get overlapped.
Z-index in CSS works only when you have set position to relative, absolute or fixed. IE-6 treat position as z-index reset, you should specifically declare position of parent element of Z-indexed element to "static" to have them respond to Z-index correctly.
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