The Users extension allows your site visitors to register, login, logout, change their passwords and change other information, as well as recover forgotten passwords, and recover forgotten Usernames.
In the site administrator area the Users extension allows you (your site Administrator) to create, block, and manage users, as well as create user groups and access levels.
User Groups and Access Levels let you, your website Administrator, determine what content is seen or not seen by various users.
For example you might only want family photos and family related articles to be seen by your family - so you as website administrator could create a User Group: Family, and set the article Access Level as: Family, family members who are registered on your website can be assigned to the Family user group. When a member of the Family user group logs in to your website front-end they will be able to see (access) articles and photos that are assigned to the Access level of Family - visitors (logged-in or not) will be unable to access those articles/photos if they are not in the Family Access Level.