How To Install WordPress Plugins and Themes – WordPress Tutorial
A WordPress plugin is something that you install on your site to perform a specific action (This could be SEO purposes, video embedding services, and much more).
A WordPress theme is the look of your website. Basically however you want your website to look is what theme you need to choose from.
*** With both plugins and themes they come in 2 different ways. Premium and Free. There are some that are really inexpensive and then others that are fairly expensive. It will all depend on your specific needs on which ones you need.