Firstly we must understand what an IP address is. An IP address is a set of numbers (or with the latest version characters and numbers) which represent an address on the internet reserved for a server. You should think of an IP address as the equivalent of your house name and address. It uniquely identifies your house as being on a street, in a city, in a country.
DNS (Domain Name System) is the glue that holds together the World Wide Web (WWW). It translates human readable and rememberable domain names entered in web browsers and used in other internet connected devices into a set of digits (an IP address) representing the location on the network (usually the internet) that needs to be visited in order to satisfy the request.
When you create a domain name it has a set of DNS records associated with it which are usually maintained by you or your web designer / developer via your domain registration agent website. These records are stored on what is called a DNS name-server. Your registration agent name-server links to many thousands of other DNS name-servers across the globe which all (eventually) will have a copy of your records.
The most common forms of DNS records are A records, CName records and MX records.
This maps a sub domain (for example www.example.com or apps.example.com directly to an IP address number.
Maps one domain name record to another. For example you could have a CName record for app.example.com in your DNS which maps to 123466.someothersite.com. It gives a way to mask that you are actually calling the other domain when people use the domain app.example.com.
Used to tell other systems on the internet how to deliver mail to your domain. There are usually multiple records entered per domain.