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Widgets are a type of Plugin (Tutorial on “How to Install Plugins in WordPress”), there are also a bunch of pre-installed widgets. Widgets are things like; Calendars, Link Lists, Recent Comments, Newsletter Signup form, login form, etc.
Where you can place Widget will vary from Theme to Theme, there is usually always Sidebar locations for Widgets though.
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Step 1) Login to WordPress.
Step 2) From the Menu on the left select “Appearance” and then click on “Widgets”.

Step 3) From the Widgets Page you can drag currently installed Widgets from the “Available Widgets” box into the different boxes on the right (in this tutorial there is only Sidebar 1, other themes may have multiple locations). To add more Widgets you need to install a Widget Plugin (Tutorial “How to Install Plugins”). Click the image below to see an example of how to use Widgets.
Step 4) Widget changes are updated when you drag them across, when you edit the settings of a single Widget you will need to click “Save”.
Step 5) Done
To install more Widgets you will need to search the Plugin Database for specific Widgets that you want, then install and activate them. Once installed and activated you will see them in the “Available Widgets” box. Here is a link to the Tutorial “How to Install Plugins”.