Drupal's Blocks System is the partner to your site's content. Of everyting you see on a Drupal page, it's either content or something from a block. With the introduction of Views, you can pretty much say most every Drupal page is Content (nodes) and Blocks or a View (which is content itself) with - again - blocks.
Quite simply, it goes like this.
Theme > Regions > Blocks > Content
Where content can come from a Module, an Embedded View or your own custom content.
You get to control which blocks show, who gets to see them and on which pages. Knowing the difference between blocks supplied by modules, and what you can do with your own blocks is one of the keys to making your Drupal site do what you want it to do.