PHP is a server-side scripting language used for web development that allows developers to add dynamic content to websites. It is compatible across platforms and browsers. PHP code is embedded within HTML and executed on the server, with the output sent to the user's browser. Variables, strings, arrays, and other data types can be manipulated to add logic and interact with databases for dynamic content. Files can be created, opened, read from, written to, and closed using PHP functions to manage files and data on the server.