WordPress templates are PHP files that determine how content is displayed on web pages. Templates can be modified in a theme or overridden in a child theme. The basic template files are header, footer, and other files that make up the overall page. Templates select which content to display, such as individual posts, categories of posts, or search results. Template tags allow themes to display things like post titles, content, dates within templates. The template hierarchy determines which specific template file is used in different contexts.