From within Excel's help file:
A PivotTable report is an interactive table that quickly combines and compares large amounts of data. You can rotate its rows and columns to see different summaries of the source data, and you can display the details for areas of interest.
Use a PivotTable report when you want to analyze related totals, especially when you have a long list of figures to sum and you want to compare several facts about each figure
Because a PivotTable report is interactive, you can change the view of the data to see more details or calculate different summaries, such as counts or averages.
In a PivotTable report, each column or field in your source data becomes a PivotTable field that summarizes multiple rows of information
To create a PivotTable report, you run the PivotTable and PivotChart Wizard. In the wizard, you select the source data you want from your worksheet list or external database. The wizard then provides you with a worksheet area for the report and a list of the available fields. As you drag the fields from the list window to the outlined areas, Microsoft Excel summarizes and calculates the report for you automatically.