Cookies are key/value pairs used by websites to store state information on the browser. Say you have a website (example.com), when the browser requests a webpage the website can send cookies to store information on the browser.
Browser request example:
GET /index.html HTTP/1.1
Host: www.example.com
Example answer from the server:
HTTP/1.1 200 OK
Content-type: text/html
Set-Cookie: foo=10
Set-Cookie: bar=20; Expires=Fri, 30 Sep 2011 11:48:00 GMT
... rest of the response
Here two cookies foo=10 and bar=20 are stored on the browser. The second one will expire on 30 September. In each subsequent request the browser will send the cookies back to the server.
GET /spec.html HTTP/1.1
Host: www.example.com
Cookie: foo=10; bar=20
Accept: */*
Server side cookies are known as "sessions". The website in this case stores a single cookie on the browser containing a unique Session Identifier. Status information (foo=10 and bar=20 above) are stored on the server and the Session Identifier is used to match the request with the data stored on the server.
You can use both sessions and cookies to store: authentication data, user preferences, the content of a chart in an e-commerce website, etc...
Below pros and cons of the solutions. These are the first that comes to my mind, there are surely others.
Cookie Pros:
Cookie Cons:
Session Pros:
Session Cons: