In the context of WordPress, widgets are functional layout parts, similar to a smartphone, that delimit a technical or visual function. A concrete example is a calendar in the Sidebar in WordPress or also a display of the categories. Both are widgets, thanks to which the overall layout of the WordPress page can be built very quickly and easily.
Widgets are practical like modules from which the website can be assembled or equipped with functions. Here the proximity to WordPress plug-ins becomes clear: Just as there are plug-ins for WordPress functions in the backend, there are also plug-ins that bring new widgets - a so-called "tag cloud" or word cloud for example (see here the results of a corresponding search at WordPress.org: Link)
In WordPress itself, widgets can be set in the backend area under the menu item "Design > Widgets". In the section Widgets you will find a list of available widgets as well as a graphic such as the sidebar, which already contains some widgets depending on the WordPress theme. By drag and drop these widgets can be removed or new ones added. Rarely are there themes that do not support widgets in any area. The most common are widgets in the sidebar and the footer.
One of the most common applications is probably the Sidebar Widget for the blog area. Here, for example, the last published articles or a list of all categories are often displayed as a widget element.