If you've downloaded a large file over the internet, you may have wondered if your download completed correctly. Are the copies on my machine exactly the same as the ones on the server?
MD5 is the name of a "hashing" algorithm which can answer this question. MD5 hashes are fingerprints of files. You can compare the fingerprints of two files to see if the files themselves are the same.
In order to be useful, you have to know what the correct fingerprint for a file is. Otherwise, you cannot tell if your file is right or not.