Packet segmentation happens at Transport Layer (layer four) of the OSI-Model. Packet segmentation may be required when:
Packet segmentation at the source usually include a mechanism at the destination to reverse the process and reassemble the original packet from individual segments. This process may include Automatic Repeat-reQuest (ARQ) mechanisms to detect missing segments and to request the source to re-transmit specific segments.
In a communication system based on a layered OSI-Model, Packet segmentation may be responsible for splitting one Protocol Data Unit into multiple Physical Layer service Protocol Data Units so that reliable transmission (and potential re-transmission via ARQ) of each one can be performed individually.