It does exactly what it does on the tin!!
In basic GCSE terms..it serves those connected to it...it has much more power than the average PC. PC's attached to it by whichever topology (network design) have access to facilities provided by it such as data, files,printers etc. The server copes with the requests by using say, a token system and serves the requests of those on the network. Once set up it *should* run atutomatically but obviously requires human intervention st times.
That is the basic idea...there are different servers for different needs..a web server, file server, print server., man servant (I made that one up hee hee).
That do you?