Plasmids are extrachromosomal DNA (apart from the main genetic material) present as circular structures in cells. They contain "accessory" genes that express specific proteins. In bacteria, these genes may code for antibiotic resistance, enzymes to utilise unique nutrient sources, virulence (the ability to cause disease), degradation of toxic compounds, and much more. Think about plasmids in cells as accessory apps on your phone: while an antivirus is not strictly required for the phone to function, it is definitely beneficial.
Plasmids mobilise these genes via horizontal transfer; that is, by methods other than traditional reproduction. This includes conjugation (cell-cell contact), transduction (bacteriophage, a virus which infects bacteria, carries the DNA and infects another bacterium), and transformation (uptake of free plasmid DNA by organisms), among others.
Interestingly, one cell contains many copies of the same plasmid, which in turn contains all the gene products necessary for its own survival. Additionally, plasmids can sometimes be detrimental to cells when their proteins are environmentally unfavorable. This has led to the plasmid paradox; should cells with plasmids really be more preferred by selection? Either way, the potential for plasmid study and research are exciting.
In the lab, plasmids are used as vectors for gene cloning. First, circular DNA is cut with a restriction enzyme to produce linear DNA. The genes to be cloned are introduced to the cut plasmid and covalently joined using DNA ligase. Finally, this modified recombinant DNA is reintroduced into bacterial cells (transformation), where large amounts of their corresponding protein is produced. This is a fundamental process in genetic engineering.