A block is a modular unit of content that can be positioned most anywhere on the page. Content blocks are sometimes referred to as static blocks, or CMS blocks. They can be used to display fixed information such as text, images, and embedded video, and dynamic information that is provided by a widget or originates in a database or other source. Most elements on the home page are blocks that can be easily managed.
You can create custom blocks of content without writing any code, and assign them to appear in a specific place in the page layout. Blocks can be positioned using the widget tool or by composing a layout update in XML and saving it on the server. For more information about using layout updates, see the Layout information in the Frontend Developer Guide.
Watch this video to learn about static and dynamic blocks: