HDRI stands for High Dynamic Range Imaging, and an HDRI environment is an environment map used in computer graphics and 3D rendering to simulate realistic lighting conditions. Unlike traditional images that use 8 bits per channel for red, green, and blue (24 bits total), HDRI images use a higher bit depth, often 32 bits per channel or more. This increased bit depth allows for a much wider range of values to be represented, capturing a more extensive range of brightness levels. In the image below you can see how the 3D scene looks with an environment added.
Or when the environment is absent
In the context of 3D rendering, an HDRI environment is typically a 360-degree image that represents the lighting conditions of a real-world environment. This image is used to illuminate 3D scenes, providing realistic lighting and reflections. The high dynamic range information in the image helps simulate the way light interacts with surfaces, including the subtle variations in brightness and color that occur in real-world lighting situations. The environment can be portrayed bot as light only effects or as the background if you enable it in the settings like in the example below.
There are two ways you can add a HDRI environment to the 3D scene: selecting one of the available preset environments or importing your own HDR/EXR files.