Each post in WordPress is filed under one or more Categories. This aids in navigation and allows posts and to be grouped with others of similar content. Each Category may be assigned to a Category Parent so that you may set up a hierarchy within the Category structure. In creating Categories, recognize that each Category Name must be unique. Thus, even if two Categories have two different Parents, they must still have different names. Links to your Categories are, by default, shown in two different places on your blog’s home page if you are using the WordPress Twenty Twelve theme. First, WordPress lists these Category as links in your sidebar. Second, WordPress shows all the Categories to which a given post belongs under that post. When someone viewing your blog clicks on one of these Category links, an archive page with all the posts belonging to that Category, will be displayed. This Screen allows you to create new Categories, edit or delete existing ones, and organize your Categories hierarchically.
– Information about WordPress Themes found on http://codex.wordpress.org –