Sourcing a file is ‘executing’ it. Essentially, each line of the file is considered a command. Sourcing it is the same as typing each command in order. You source with the command :source (usually shortened to :so).
So if you source myStuff.vim
:so myStuff.vim
and if myStuff.vim contained these lines
set xx iI just intersted this<C-]>
set yy bbbb4dw
It’s the same as if you typed those commands into Vim
:set xx iI just intersted this<C-]>
:set yy bbbb4dw
The only file sourced by default is the .vimrc(_vimrc on windows) so that’s a place you can keep all the commands you use to set up Vim every time.
Where it gets interesting is the fact that since a sourced file is just a series of commands, and sourcing is a command, you can source files from your source files. So plugins you use every time could be sourced when you start up Vim by adding a line to your .vimrc like this
so myPlugin.vim