Categories & Tags
Both pages and posts can have Categories, but only posts can have Tags.
Categories
Categories allow you to categorize posts and pages in broad groups.
It’s best to give a page or post only 1 or 2 Categories maximum.
Categories can be arranged in a hierarchy by nesting subcategories into parent categories. For example, a Baking category may have subcategories titled Breakfast, Lunch, Dinner, and Desserts.
Tags
When you want to describe a post in more specific terms, use Tags. Tags are similar to Categories, but they are used to describe your post in more detail.
It’s best to give a page or post only 3-5 tags maximum.
Tags exist in their own right and have no set hierarchy or relationship to anything else. The use of tags is entirely optional (although each post must be attached to at least one category).
Examples
Let’s say you’re about to post a recipe for brownies on your food blog. You’d probably want to use categories like Dessert and Baking, and tags like Chocolate, Brownies, and Walnuts.
If you’re creating a post about the Dalai Lama giving a talk about peacebuilding in Gaston Hall, a good Category to use would be Events or News. Good Tags to use would be Dalai Lama, Gaston Hall, or Peace.