There are the two main types site spaces (or global spaces) and personal spaces. Site spaces are by default open to everyone and each user can create content and collaborate with other users. Personal spaces belong to specific users. By default, these are private but you can open private spaces up for other users to view or edit. Personal spaces are listed in the people directory.
Imagine a space as a sub-site, or mini-site, each with its own home page. It is very common to use spaces to cluster content around a specific topic or to use it as a team- or department space.
Similar to creating pages, you can create a blank space or choose to use a space blueprint. There is no limit to the number of site spaces you can create. Each space has a unique identifier, the space key. The space key is automatically created when you create a space but it can be edited. For example, you might give your documentation space a key of "DOC". Have a look at the following demonstration on how to create a space and set its permissions.
You can mark spaces as favourites to have quick access to those spaces you are working with most often. Favourites can be shown on your dashboard.