Docker allows users to package applications with all their dependencies into standardized units called containers that can run on any Linux server. Containers are more lightweight than virtual machines because they share the host operating system and only require the additional libraries and binaries needed to run the application rather than a full guest operating system. Docker uses containers and an image format to deploy applications in a consistent manner across development, testing, and production. The document provides examples of how to define a Dockerfile to build an image, run containers from images using docker-compose, and common Docker commands.