A Library is a list where each item in the list refers to a file that is stored in SharePoint. Libraries have all the same behaviors as lists, but because libraries contain files, they have extra features. One of these is the ability to be opened and modified through a compatible WebDAV client (e.g. Windows Explorer).
Microsoft SharePoint comes with some pre-defined list and library definitions. These include: Announcement Lists, Blogs, Contacts, Discussion Boards, Document Libraries, External Content (BCS) lists, Pages, Surveys, and Tasks.Some of these pre-defined lists have additional integration. For example, lists based on the contact content-type can be synced directly with Microsoft Outlook.
How to create a document library in SharePoint 2010
1. Open the SharePoint site on which you wants to create a document library
2. Click on site actions (left hand side-top corner)--New Document Library
1. Site actions
2. More Options (please refer the following screenshot)
3. This will open a following window from which we can select the appropriate library as per the project requirements:
4. Enter the name of the document library
5. Create6. Document library will be successfully created.
If you have any queries/questions regarding the above mentioned information then please let me know. I would be more than happy to help you as well as resolves your issues :-)