Category, This is a feature of the database that operates within Joomla. Normally there is very little you need to do with categories. What you do need to know is that all other features of your site; modules, articles, menus, etc, all need to be assigned to a category. It’s advisable to have a simple structure of categories, for example; mirroring the main menu of your site.

A category is commonly a collection of articles and is used to structure the content of a site

Creation of categories is normally the first step in the creation of a site - Categories > Articles > menus

Categories can have parent categories to improve structure and best display content

Categories can also be used to display content, e.g. category blog layouts, or via modules or plugins