Segments are simply portions of a track. A track is made up of one, or many, segments. If it has more than one, one starts where the last one ends (they do not overlap).

Segments are represented in the GPX file as the <trkseg> element within the <trk> element, as defined in the GPX specification. But they are useful when editing tracks as well.

As far as this site is concerned, all trackpoints have to be within a segment, they do not go directly in the track. Some other sites/tools generate GPX files that DO have points directly within a track, and not in any segment; this site will still recognize files with 'orphaned' points, if you upload them, but it will always then put the orphaned points into a segment.

Segments are only relevant to tracks, and do not feature in routes.

When you draw a track, each drawing operation, whether routing by car mode, bike mode, walking mode, or as-the-crow-flies, adds a new segment.

You can also join segments, by left clicking the first of the segments that you want to be combined into one, and then right clicking on the last one, and choosing 'join selected segments'.

You can split a segment into two, by right-clicking on the track at the point at which you want to split, and choosing 'Edit, Split here'.

A lot of operations are performed on just the current segment.

Re-route and show elevation are the main examples.

If you want to re-route part of a track, it is best to confine the part that will be re-routed to only the bit that you aren't sure of. Segment splitting achieves this - only a particular segment will be re-routed, not the whole track. (The 'Edit, Re-route between' option is a convenient shortcut for defining a segment and then rerouting it.)

Also, the 'Show Elevation, for selected segment' option is useful for figuring out which parts of a route are hilly. You can split and join segments and keep re-generating the elevation profiles for them to get a clearer picture of where the hills are on your track.