A RAR file is a collection of compressed files, processed to take up less space. It is generally referred to this way because RAR files typically use a file name extension of .rar. A RAR file can be transferred to other computers more quickly than uncompressed files. In order to extract files from a compressed RAR file, you need to use a special program that is designed to work with RAR files.
An alternative to using RAR files is to use zip files, which can be compressed and uncompressed by Windows.