In Excel you can name a range of cells. When you do that, you can use this name in your formulas, instead of the address. In general it is easier to remember a name than a range address of a range of cells.
Using names has a couple of advantages: ranges are easier to find, formulas are simpler to understand and maintenance of the spreadsheet model becomes more reliable.
Furthermore, some things in Excel can only be achieved by using defined names. But much more is possible with defined names than just naming a range of cells. Because you can also put a formula into a name, a whole world of possibilities opens up!
Even more so, you can put the old Excel 4 macro functions to use in a defined name. This enables you to do things normally only possible using VBA.