The English alphabet has 26 symbols in lower case, plus the same in upper case, as well as 10 symbols for numbers. Unlike humans, computers work and communicate with 2 symbols; ’1′ and ’0′. This is what is called digital signals. Using combinations of those two symbols, digital machines can represent just about everything in the universe. Arduino represents ’1′ with 5 volts (5V) and ’0′ with 0 volts (0V).
You can connect both digital inputs and outputs to an Arduino. A digital input means that Arduino is reading digital data from a sensor, for example a button. When reading from a button the Arduino will read one of two states, either 5V or 0V depending on if the button is being pushed or not. A digital output means that Arduino is writing digital data to an actuator, for example an LED. To turn an LED on the Arduino writes 5V, to turn it off Arduino writes 0V. In the code you write, 5V is represented with HIGH, and 0V with LOW.
Binary logic
Another common characteristic to all computers is that they use binary logic. Binary logic means that there are two only possibilities. Since a computer uses only two symbols ’1′ and ’0′, it too, uses binary logic. In this case ’1′ represents true while ’0′ represents false. This is because binary logic can also be used to ask questions like “did the temperature reach 20 degrees?”, the answer is then either true or false and can then be represented with ’1′ or ’0′.