Plugins extend the functionality of WordPress by adding new features, automating tasks, and changing how a site is displayed. There are over 52,000 free plugins available on WordPress.org that can add functionality like forms, shopping carts, security, speed optimization, and more. It is important to choose plugins carefully based on compatibility, updates, support, and reviews to avoid issues like white screen of death. Popular plugins include Jetpack, Contact Form 7, WooCommerce, Akismet, and Yoast SEO.